Macau's Leader Warns World's Biggest Gambling Hub Could Face A.

HONG KONG, April 16 (Reuters) - The leader of Macau stated the enclave risks slipping into a spending plan deficit if betting earnings worldwide's biggest gaming hub drop below 15 billion patacas ($1.88 billion) a month after they disappointed government projections in the first quarter.


President Sam Hou Fai made the discuss Tuesday to regional lawmakers, according to a federal government statement.


"If subsequent video gaming incomes still do not satisfy the target, the Government will face a deficit spending," he said, according to the statement.


Macau is an unique administrative region of China and is the only location where Chinese people are lawfully enabled to bet in gambling establishments.


A Portuguese colony until 1999, its economy is greatly reliant on its casino industry which contributes about 80% of the government's tax revenues.


"The imbalance in our fiscal structure is serious and we need to preserve a strong sense of crisis awareness. Macau is a small city, yet our routine expense is significant and it will continue to grow unless we deal with up to severe circumstances," he stated, according to public broadcaster TDM.


A slow down in economic growth both in China and worldwide are essential concerns for Macau's casinos, particularly provided a flurry of U.S. statements to impose import tariffs worldwide, including on China, experts said.


DS Kim, an expert at JP Morgan in Hong Kong, said Macau faces "second-order impacts" from the anticipated downturn in orders for neighboring Guangdong, China's largest export hub, and a weaker yuan.


He now anticipates a prospective worst case 10% decline in gaming earnings for Macau versus a low single-digit development projection.


Macau's first-quarter video gaming revenue rose 0.6% year-on-year to 57.7 billion patacas, or 19.2 billion patacas per month, versus the federal government's full-year forecast of 240 billion patacas, or 20 billion patacas per month.


Authorities in Beijing and Macau have mandated that the six licensed casino operators Sands China, Wynn Macau, SJM Holdings, MGM China, and Melco Resorts diversify their earnings base away from the gambling establishment market. ($1 = 7.99 patacas) (Reporting by Farah Master: Editing by Neil Fullick)