Macao’s post-pandemic economic recovery is proceeding well, but recovery and development are uneven.
Photo from CFP
By GE Zhenwei
Ho Iat Seng, chief executive of China's Macao Special Administrative Region (SAR), on Tuesday delivered his policy statement for fiscal year 2024, stressing economic recovery and diversification.
Macao in 2024 is to "consolidate recovery, focus on diversification, optimize livelihoods, and enhance development."
This means the 1+4 plan.
The 1+4 plan involves maintaining traditional mainstream industries such as the closely intertwined casino, tourism and leisure sectors while developing healthcare, finance, high-tech and MICE.
The SAR will support business transformations and upgrades, particularly small and medium-sized enterprises in 1+4 industries. One goal is to recruit talent from beyond Macao.
Small as it is, with a population under 700,000, Macao is highly dependent on the external economic environment. The pandemic severely affected tourism in Macao, exposing the frailties of a single-industry structure. Diversification is essential.
The Macao Special Administrative Region Economic Moderately Diversified Development Plan (2024-2028), released this month, is Macao's first attempt to formulate an industrial development plan.
The "Plan" sets out to increase the non-casino share of GDP to around 60 percent by 2028 while maintaining non-casino employment at around 80 percent by 2028. Over the next five years, more than MOP 5 billion (US$600 million, 4.5 billion yuan) will be invested in research and development with the intention of attracting 2,000 graduates.
Regarding the casino industry, licensed casino operators must ensure they fulfill their commitments to non-casino projects.
Concerning the integration of Macao and neighboring Hengqin, and island in China’s Guangdong province, Ho emphasized policy connectivity between Macao and Hengqin, aligned with 1+4.
Any kind of industrial development requires land and with Hengqin just across the water, less than 200 meters away, Guangdong-Macao cooperation is important to Macao's future.
In the name of deep cooperation, it is proposed that the entire island become a special customs zone. Furthermore, the Macao New Neighbors project on the island is set to provide accommodation, education, health, and social services for up to 15,000 Macao residents residing on Hengqin.
The number of Macao-funded enterprises in the cooperation zone increased by 13.8 percent last year, while total operating income increased by 28.6 percent.
In the first half of 2023, Macao's GDP increased by 71.5 percent year-on-year. Close to five times more tourists are arriving now than last year, making Macao the top destination for mainland Chinese.
Macao’s post-pandemic economic recovery is going well. However, Ho emphasized that recovery and development are uneven. Some industries, enterprises and residents continue to suffer from the impact of the past three years.