24
José I. Duarte
Economist, Macau Business Senior analyst
jid@macaubusiness.com
Less panic, more reason
The Statistical Department has just released concede). But that didn’t change the overall trend.
the long awaited GDP data for the last
Of course, should credit woes lead to bankruptcy or a
quarter of 2008 and, therefore, the full year
seriously diminished operational ability of some of the present
results for the economy. These figures are
concessionaires, and the outlook would change for the worse.
Secondly, the downward trend in manufacturing exports
of interest at all times, without a doubt. But
is nothing new. it is a part and a consequence of a changed
the expectation surrounding this year’s was
international framework, mainly in textiles. That led to an
certainly singular. inevitable reorientation of the domestic allocation of resources
and a fundamental change in its economic structure.
the first place, the world recession is in full motion. Deeper implications may result from the contraction in
Secondly, the suspension of investments and gambling exports and revenues, the third aspect mentioned
shrinkage of the labour force suggests a marked above. But, again, and for now, a word of caution is necessary.
slowdown in the economy. Third and lastly, the as we have seen, full year figures are still high. The recent
comments made by the Secretary for the Economy, on a slowdown has not been too steep if we take into account that
number of occasions, have pointed to a very hard landing for most of the public comments made concerning the latest
the economy. monthly data for visitors and gambling revenues are missing a
Despite this context, the overall result achieved is striking: crucial fact.
a real growth for the year of just over 13 percent. in the longer Homologous data, when the Chinese New Year period
view of things, this result still represents the fourth highest falls in different months on consecutive years, can be very
growth rate since the handover and is almost double the rate of misleading. in fact, if we compare the data from February,
the “worst’ year, post gambling monopoly, 2005. last year, to January, this year, the changes are almost
Certainly, the context is different and there are reasons for meaningless.
concern about the coming months or couple of years. But one and, again, they cast additional doubts on the so often
cannot avoid a certain feeling that too much ado is being made invoked problem of the individual visas. it provides for strong
about what, so far, is the mild effect of a number of external titles, for sure; unsettles over-sensitive analysts, that seems
events on the local economy. Events over which, we should not to be the case; but the data does not appear to bear any
forget, we have little influence. significant correlation between the two variables.
No doubt, the negative growth in the 4th period cannot be Of course, policy changes have some impact: they affect
ignored: a 7.6 percent contraction in real terms is sharp and, perceptions and shape behavior. But so far, they can hardly be
by the standards we became accustomed to, certainly a shock. understood as more than a reminder that the hands that hold
This was the result, mainly, of decreases in private investment, the tap are not the same that roll the dice.
and exports of goods and services. Nothing of what has been said means that a slowdown can
However, for the whole year, exports of services, meaning be avoided, or that it won’t have major consequences for some
essentially gambling and hotel services, showed a robust in the economy. But we should concentrate on what can be
growth of more than 30 percent and 20 percent respectively. done and is within our powers to do - and take a less alarmist
What can be said then, taking a preliminary approach, about approach to the impact of the outside world on our small
these trends? economy and start living somewhat less obsessed with the
Firstly, the slowdown in investment was growth rate.
to be expected and was already in course, Besides, even if the economy
so to speak. in fact , the last five quarters contracted by, say, an amazingly frightening
have shown a sustained contraction in 50 percent in the next year, that would still
private investment. in that sense, the leave us richer, both in aggregate and in
international financial instability simply per capita terms, than we were (can you
brought forward the inevitable. it forced a guess?) just five years ago. and the public
re-scheduling of current investments and coffers would still be in the black. Shouldn’t
a re-assessment of some intentions (some we be concentrating on issues other than
of which never looked too realistic, let’s growth alone?
april 2009
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