VIP gaming’s share of Macau revenue to remain low amid market shift to mass: IMF

The VIP segment of Macau’s casino industry is expected to account for a relatively small share of overall gaming revenue over the medium term, despite some signs of recovery, says the International Monetary Fund (IMF). The institution said Macau’s gaming sector had undergone a “structural shift” since the Covid-19 pandemic, with growth increasingly driven by mass-market gambling. In its latest consultation report on Macau, released on Tuesday, the IMF noted that mass-market gaming accounted for circa 73 percent of the city’s casino gross gaming revenue (GGR) in 2025. “While the VIP segment showed some signs of recovery, its share of GGR is expected to remain relatively low as casinos adapt to the post-pandemic operating environment and the tightened rules for junket operators introduced since the 2022 gaming-law reforms,” the IMF stated. The institution said the regulatory changes included measures aimed at strengthening governance and anti-money laundering and countering the financing of terrorism (AML/CFT) safeguards. The IMF observed that Macau’s casino GGR increased by 9.1 percent year-on-year in 2025, reaching approximately 85 percent of its 2019 level. Casino GGR rose by a further 6.9 percent in the first half of 2026, “driven by the mass-market segment,” it added. Despite the recovery in gaming and tourism, Macau’s real gross domestic product (GDP) remained about 10 percent below its pre-pandemic level, partly reflecting “structural changes” in the gaming industry, including “weaker” demand from high-end customers, according to the report. The IMF attributed those changes partly to tighter regulation of VIP gaming, including stricter licensing requirements, limits on credit provision and enhanced AML/CFT enforcement. The institution also highlighted Macau’s continued reliance on the casino industry, which it estimated accounted for between 40 percent and 45 percent of the city’s GDP. Visitors from mainland China represented approximately 70 percent of total tourist arrivals, per the report. Such concentration exposed Macau’s economy and fiscal revenue to “external shocks and cyclical volatility,” the IMF noted. The report identified greater competition in the gaming industry as one of the downside risks to Macau’s economic outlook, alongside a potential slowdown in mainland China, renewed trade tensions and global financial market volatility. The IMF forecast Macau’s real GDP to “moderate to 3.3 percent in 2026 and 3.1 percent in 2027 from 4.7 percent in 2025, reflecting external headwinds”. It expected economic growth to remain around 3 percent annually over the medium term, as slower growth in mainland China weighed on Macau’s tourism and gaming sectors. On economic diversification, the IMF said further investment would be required for Macau to achieve its target – as stated in the city’s Third Five-Year Plan – of increasing non-gaming activities to 60 percent of GDP by 2030. The IMF identified investment in skills, talent attraction, physical and digital infrastructure, and improvements to the business environment as priorities. The institution also noted that Macau’s non-gaming economy continued to operate below its potential, estimating a negative output gap of 1.6 percent in 2026, which it expected to narrow gradually and close by 2030. The IMF said Macau’s growth would be supported by gaming revenue and a recovery in private investment, partly linked to the casino concessionaires’ commitments to invest in non-gaming activities. The institution nevertheless warned that the outlook remained subject to significant risks, with a more prolonged downturn in the local property market and weaker-than-expected demand from mainland China potentially affecting economic activity.