IMF forecasts Macao's economy to grow 15.5 pct this year

MACAO, April 13 (Xinhua) -- The International Monetary Fund (IMF) projected the economy of China's Macao Special Administrative Region (SAR) to grow by 15.5 percent this year and 23.3 percent next year, the Monetary Authority of Macao said on Wednesday.

Affirming the Macao SAR government's policy response in containing COVID-19 and the effective deployment of fiscal resources to soften its adverse impact on the economy, an IMF report released on Wednesday expected domestic demand and the revival of visitor arrivals to support Macao's economy to grow by 15.5 percent this year, according to the SAR's monetary watchdog.

Underpinned by increased investments and Macao's further integration into the Guangdong-Hong Kong-Macao Greater Bay Area, the report forecast Macao's economic growth to accelerate to 23.3 percent next year and the long-term potential growth rate to be around 3.5 percent.

The IMF agreed that Macao's economic diversification policies will enhance the economy's resilience if implemented well. Meanwhile, the IMF recommended a multi-dimensional approach to expanding the supply of skilled labor to advance economic diversification, increasing investments in information and communication technology infrastructure, promoting regional cooperation and streamlining business regulations.

The IMF also recognized Macao's efforts in promoting modern financial services, reminding that persistently strengthening the regulatory and supervisory framework of the financial sector is necessary to safeguard financial stability and integrity.

The Macao SAR government's measures on anti-money laundering and combating financing of terrorism are welcomed and should be reinforced constantly, showed the report.

The IMF reaffirmed that the linked exchange rate system between the pataca and the Hong Kong dollar underpins Macao's economic and financial stability, attributable to the implementation of counter-cyclical fiscal policy as well as maintenance of adequate foreign exchange reserves, a robust banking sector, and a flexible labor market.