The International Monetary Fund (IMF) has raised its economic growth forecast for Macau in 2017 despite a still fragile gambling industry.

In its 53-page report released on Wednesday, the international monetary lender has revised its outlook for Macau upwards, from 0.2 percent to 2.8 percent on the back of large financial reserve that will serve a buffer against economic headwinds.

Data from the IMF shows that Macau’s foreign exchange reserves were roughly US$19 billion after 15 years of double-digit current account surpluses. Its net assets reached 280% of GDP at the end of 2015.

“Real output is expected to contract for a third consecutive year in 2016. However, external demand has begun to recover with gaming revenues posting six consecutive months of positive annual growth. In 2017, a low base will help increase growth above 2 percent despite continued weak domestic demand,” the IMF said. “Further out, Macau… is well-positioned to record sustainable growth in the mid-single digits. In addition to its still highly valuable gaming monopoly within China, Macau… is an established tourist destination with significant geographic proximity to – and cultural affinity with – mainland China. Moreover, Macao SAR is now investing aggressively in non-gaming tourism and financial services.”