Page 468 - 2018 White Paper on the Business Environment in China
P. 468
8 White Paper on the Business Environment in China
3.7 Macao Special Administrative Region
The Orient’s Las Vegas for its gambling industry and is the only place in China
where gambling is legal. The majority of the population
A former Portuguese colony situated at the entrance speaks Cantonese, but Portuguese remains an official
to the Pearl River Delta only forty miles from language and English is widely used in trade, tourism
Hong Kong, Macao is the smaller of China’s two special and commerce. Since the liberalization of its gaming
administrative regions – at only 1/40 the size of Hong sector in 2002, Macao’s economy has expanded rapidly
Kong, with approximately half a million residents (not with significant investment in new hotels, casinos and
many more than Luxembourg) and a total of 33 casinos. convention facilities by developers from Hong Kong,
Australia, and the United States.
Spotlight on Macao over Time
The city now represents the world’s largest gaming
Under British rule and with the deep port of Victoria capital, having surpassed Las Vegas in 2006. Macao’s
Harbor, Hong Kong quickly gained importance as a major gambling revenues grew by an average of 29 percent a
trade center, overshadowing the commercial importance year between 2008 and 2012. Casino revenue increased
of Portuguese-ruled Macao. The key exception to Hong to 233.2 billion patacas (US$29 billion), much higher
Kong’s commercial superiority over Macao was during than the revenue of the Las Vegas Strip (US$8 billion).
World War II when Macao experienced brief economic However, this over-reliance on the gaming industry
prosperity as the only neutral port in South China, after has made the Chinese central government prioritize
the Japanese occupied Guangzhou and Hong Kong. diversification of the region’s economy.
From 1943 to August 1945, Japan created a virtual
protectorate over Macao, assuming control of its affairs. The region’s top trade partners are mainland China,
Hong Kong, Japan, the E.U., Taiwan and the United
In 1974, the Portuguese government granted States. The region’s exports include clothing, textiles,
independence to all overseas colonies and recognized footwear, toys, electronics, machinery and parts; while
Macao as part of China’s territory. The Chinese imports include raw materials and semi-manufactured
government did not take over administration of goods, consumer goods (foodstuffs, beverages, and
the territory until February 8, 1979, when China tobacco), capital goods, mineral fuels and oils.
acknowledged Macao as a Chinese territory under
Portuguese administration. Due to Macao’s increasing operational costs, it is
no longer suited for labor-intensive industries, and
On April 13, 1987, “The Joint Declaration on the accordingly, textile and garment exports are likely to
Question of Macao” was signed between China and shrink further in years to come. Yet the region continues
Portugal to agree that Macao would revert to Chinese to develop as one of the top gambling and tourist
rule on December 20, 1999 also under the “One Country, destinations in the world. Growth areas include finance,
Two Systems” policy. As per the Hong Kong SAR, the insurance, construction, real estate and manufacturing.
Chinese government promised that the Macao SAR will Macao’s gambling industry still accounts for an estimated
enjoy a high degree of autonomy in all matters except 40 percent of its GDP.
foreign and defense affairs for 50 years.
Macao’s currency, the pataca (MOP), is closely tied to
Economy the Hong Kong dollar, which is freely accepted in Macao.
Hong Kong’s links with Macao’s gambling industry are
As a free port (where goods are received and extensive, especially through three of the six companies
shipped free of customs duties), Macao is best known with gaming licenses in Macao: STDM, Galaxy, and
468
3.7 Macao Special Administrative Region
The Orient’s Las Vegas for its gambling industry and is the only place in China
where gambling is legal. The majority of the population
A former Portuguese colony situated at the entrance speaks Cantonese, but Portuguese remains an official
to the Pearl River Delta only forty miles from language and English is widely used in trade, tourism
Hong Kong, Macao is the smaller of China’s two special and commerce. Since the liberalization of its gaming
administrative regions – at only 1/40 the size of Hong sector in 2002, Macao’s economy has expanded rapidly
Kong, with approximately half a million residents (not with significant investment in new hotels, casinos and
many more than Luxembourg) and a total of 33 casinos. convention facilities by developers from Hong Kong,
Australia, and the United States.
Spotlight on Macao over Time
The city now represents the world’s largest gaming
Under British rule and with the deep port of Victoria capital, having surpassed Las Vegas in 2006. Macao’s
Harbor, Hong Kong quickly gained importance as a major gambling revenues grew by an average of 29 percent a
trade center, overshadowing the commercial importance year between 2008 and 2012. Casino revenue increased
of Portuguese-ruled Macao. The key exception to Hong to 233.2 billion patacas (US$29 billion), much higher
Kong’s commercial superiority over Macao was during than the revenue of the Las Vegas Strip (US$8 billion).
World War II when Macao experienced brief economic However, this over-reliance on the gaming industry
prosperity as the only neutral port in South China, after has made the Chinese central government prioritize
the Japanese occupied Guangzhou and Hong Kong. diversification of the region’s economy.
From 1943 to August 1945, Japan created a virtual
protectorate over Macao, assuming control of its affairs. The region’s top trade partners are mainland China,
Hong Kong, Japan, the E.U., Taiwan and the United
In 1974, the Portuguese government granted States. The region’s exports include clothing, textiles,
independence to all overseas colonies and recognized footwear, toys, electronics, machinery and parts; while
Macao as part of China’s territory. The Chinese imports include raw materials and semi-manufactured
government did not take over administration of goods, consumer goods (foodstuffs, beverages, and
the territory until February 8, 1979, when China tobacco), capital goods, mineral fuels and oils.
acknowledged Macao as a Chinese territory under
Portuguese administration. Due to Macao’s increasing operational costs, it is
no longer suited for labor-intensive industries, and
On April 13, 1987, “The Joint Declaration on the accordingly, textile and garment exports are likely to
Question of Macao” was signed between China and shrink further in years to come. Yet the region continues
Portugal to agree that Macao would revert to Chinese to develop as one of the top gambling and tourist
rule on December 20, 1999 also under the “One Country, destinations in the world. Growth areas include finance,
Two Systems” policy. As per the Hong Kong SAR, the insurance, construction, real estate and manufacturing.
Chinese government promised that the Macao SAR will Macao’s gambling industry still accounts for an estimated
enjoy a high degree of autonomy in all matters except 40 percent of its GDP.
foreign and defense affairs for 50 years.
Macao’s currency, the pataca (MOP), is closely tied to
Economy the Hong Kong dollar, which is freely accepted in Macao.
Hong Kong’s links with Macao’s gambling industry are
As a free port (where goods are received and extensive, especially through three of the six companies
shipped free of customs duties), Macao is best known with gaming licenses in Macao: STDM, Galaxy, and
468
