Hallelujah, Macau’s GDP has finally grown!

The author of this event was the implicit GDP deflator, an index that shows the relationship between nominal and real GDP, obtained by dividing the nominal value by the real value, multiplied by one hundred. What has happened? When the deflators rise (translating the idea that the nominal value moves further from the real value, […]

The author of this event was the implicit GDP deflator, an index that shows the relationship between nominal and real GDP, obtained by dividing the nominal value by the real value, multiplied by one hundred.
What has happened?
When the deflators rise (translating the idea that the nominal value moves further from the real value, due to the increase of the various prices), the difference between the nominal and real growth of the economy is greater.
Conversely, when they grow less or even decrease, this translates into a smaller difference between nominal and real growth.
In the fourth quarter of 2016, nominal growth was 4.2 per cent and real growth 4 per cent, minus just 0.2 percent!
In the fourth quarter of 2013, for example, the nominal value of GDP had grown 22.6 per cent but the real was only 13.3 percent. In practice there was a difference of 9.3 percentage points.
If we had a 2013-type deflator, we would have probably fallen more than 4 per cent, instead of growing by 4 percentage points!
That which was largely responsible, therefore, for the real growth in the fourth quarter was the deflator.
There has been a clear decrease in the ratio of gaming services / exports of other services! Diversification?
Please think!
This ratio, which has always been more than three points in periods of economic growth, fell below three points in 2015 and in 2016, and with the exception of the second quarter, was always below three points.
In the third quarter of 2016, the approximate ratio was 2.76 points.
But the truth is that in the last quarter of 2015, it was even lower than this value, reaching 2.6 points! Are we going to say that at that time we also saw a diversification judging by the dynamics of the economy itself?
Conclusion, this diversification was made, to be honest, when the game was not allowed to grow naturally.
Admitting that we would have a deflator as nice as the third quarter, for the economy not to decline in 2016 or, if you want, to stay at zero, real fourth quarter growth should be approximately 16.3 percentage points!
So, in 2016 the economy will still falling.
However, if the gaming industry has the same behavior as this November, we can then have a positive growth in 2017!
Maybe!

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