According to a press release published by Fitch Ratings today, the international rating agency affirms Macao SAR’s credit ratings (long-term foreign and local currency issuer default ratings) at “AA”, whereas the rating outlook is revised from “stable” to “negative”.
The rating agency reaffirms Macao SAR’s “AA” rating (the third highest rating), which is mainly based on its strong fiscal position for payment of financial commitments as well as the SAR Government’s stringent fiscal prudence. On the other hand, the rating agency revises the rating outlook to “negative” as the performance of the tourism and gaming industry may be dragged by the downward revision on economic growth of Macao’s major export market and other negative external factors in the future.
At the moment, the public finance of Macao SAR is remarkably sound. The fiscal balance for the first 10 months of 2019 stayed in surplus, valued at MOP47.9 billion, after registering a surplus of MOP53.9 billion in 2018. At the end of October 2019, the Fiscal Reserve capital was preliminarily estimated at MOP574.9 billion, which was equivalent to 129% of the nominal GDP in 2018, or over five years of the 2019 budgeted government expenditure. Meanwhile, the SAR Government maintains its zero-debt status.
Macao SAR’s strong fiscal strength, solid external financial position, credible policy framework, resilient linked exchange rate system, sound financial system and reliable economic fundamentals will continue to support the SAR’s creditworthiness and economic resilience against external impacts.
Fitch’s press release can be found via this link:
https://www.fitchratings.com/site/pr/10105351