Macao may face US economic sanctions if it fails to take concrete steps to tackle human trafficking within the next 12 months, according to a senior state department official.

The department’s annual Trafficking in Persons report, released last month , placed the casino boom town on its “tier 2 watch list” for the second consecutive year, just one rung above the bottom tier 3 category that includes the likes of Sudan, Iran and Burma. If relegated to tier 3, Macao could face US sanctions.