Macau Business | May 2024 | Special Report | 20 years, 20 changes

Macau Business is watching

Macau today is a vastly different city than it was 20 years ago. Throughout this special report, we’ve identified a list of 20 changes, some of them, but many others had to be left out due to space constraints.

Why 20 years? Because Macau Business was born precisely two decades ago. But also because it was in May 2004 that the transformation, which we can all witness today, began with the opening of the first casino by one of the new gaming operators (Sands).

The city began to change, and here at Macau Business, we’ve been privileged witnesses to these transformations.

Macau will continue to change. The difference now is that few dare to predict where it will be in another 20 years.

All you have to do is read our magazine every single month.

Co-ordinated by João Paulo Meneses jpmeneses@macaubusiness.com

Much more education

To describe what has changed in education in Macau over these two decades, there is nothing better than referring to some numbers that do not require other considerations:

Environmental awareness

During the Portuguese administration, civil society in Macau was not particularly active, and some observers argue that not much has changed since the handover. However, there have been a few exceptions that stand out over the past two decades: the defence of historical heritage and the unique characteristics of the city (see the section on UNESCO in this special report), and the advocacy for a better environment.

Pathological gambling

One of the inevitable consequences of the expansion of the casino business has been the emergence of problem gambling among casino patrons, whether they are Macau residents or tourists.

GBA: expectations and results

Hengqin promises to change Macau, but the Guangdong Hong Kong Macau Greater Bay Area (GBA) project, involving nine cities in Guangdong province plus the two special regions, has the potential to become the world’s leading Bay Area. And if that happens, Macau will benefit the most.

Hengqin: Second Macau or extension?

There are 20 changes singled out in this special report, but if we had to choose just one, it would be the transformation of Macau into the world capital of gambling, measured in gross gaming revenues, surpassing Las Vegas and Atlantic City combined. Two decades from now, when Macau Business turns 40, the most profound transformation is likely to be called Hengqin.

Towards a hyper-ageing society

It was anticipated news, and confirmation arrived in March when the Statistics and Census Service released demographic data for 2023: the elderly population surpassed the young population for the first time, with the ageing rate significantly increasing to 106.1 percent. The elderly dependency rate was 24.8 percent (+1.7 percentage points annually), meaning that now, around 4 adults supported one elderly person.

Junkets, falling from grace

Twenty years ago, junkets (gaming promoters) were the primary drivers of casino revenue in Macau, with VIP gaming reigning supreme. A legacy of monopolistic times, none of the new concessionaires had the courage to reject the model that Stanley Ho had ‘invented’ a few decades earlier. Despite the high costs of commissions charged, the promoters represented a part of the business that the new operators did not dominate: the high rollers in the Chinese market, where not only gambling but also promoting this activity is prohibited.

Land Law, law of the land

A series of unprecedented events unfolded with the approval and subsequent implementation of the so-called Land Law (Law 10/2013): there were votes against, legislators leaving the room during the vote, a lawmaker appointed by the Chief Executive presenting a proposal to allow another interpretation of one of the most controversial Articles (the interpretive rule of Article 104(5)), and many deputies who initially voted in favor later regretted their decision, calling for a revision that never materialised.

Beating Las Vegas

For decades, Macau has been marketed to tourists as the Las Vegas of the East, a comparison even used in official promotions.

LRT: Promised mobility?

Since the end of the Public Opinion Program at the University of Hong Kong, we no longer have regular opinion polls on everyday life in Macau. It would be interesting to understand what local society thinks about its Light Rapid Transit (LRT) and, for example, how many have already travelled on the only operating line, the Taipa Line.

Casino market share shifts

Back in May 2004, Macau saw the opening of the city’s first foreign-owned casino as the liberation of the city’s gaming industry was coming into fruition. Sands Macao opened its doors with a bang in the Macau peninsula. It was just the beginning of a boom in both supply and demand with the Cotai strip and the new integrated resorts model taking centre stage. The monopoly held by SJM’s predecessor – STDM – gave way to a diversified landscape with six operators and a few ‘satellite’ casinos under third-party arrangements (majority operating under SJM’s license).

National security, comprehensive

In 2009, the Legislative Assembly approved the Law related to Defence of Security of State (also known as the Macau National Security Law), which prohibits and punishes acts of “treason, secession, and subversion” against the Central government, as well as “preparatory acts” leading to any of the three acts. The approval process was smooth, intended to comply with Article 23 of the Macau Basic Law, and since then, it has never been used.

Offshore: Heyday (and fall)

When Macau authorities realised that traditional industries with a significant impact on the local economy, such as textiles, toys, or fireworks, were relocating to China, they tried to attract companies from Hong Kong by promising a generous tax regime (the zero-tax rate).

Pandemic: Unprecedented challenge

In November 2022, many people in Macau were surprised to see thousands of spectators in football stadiums watching the World Cup in Qatar… without masks. At that time, very strict epidemic prevention measures were still in force here, aligned with the Zero-COVID policy. Relief only began on December 8.

Political reform (non) issue

While political reform seems to be a non-issue nowadays, it hasn’t always been the case over the past two decades. 

The Lusophone platform

The liberalization of the gaming industry and the influx of foreign investment, notably from US giants, enhanced Macau’s image as the Las Vegas of the East.

Public housing focus

 In Denmark, South Africa, Canada, or New Zealand, housing consistently ranks among the top concerns when you ask people about their priorities.

Mass tourism

At the beginning of 2005, the front pages of newspapers could be seen reporting on the spectacular increase in the number of tourists who had visited Macau the previous year: from 10.5 million in 2003 to 15.1 million.

Proudly UNESCO-listed

Macau, with the support of the Central Government, applied to have the historic centre of the city recognised as a World Heritage Site and received a positive response in July 2005.

Finally, the universal minimum wage regime

The universal minimum wage for all professions was only created in 2020. Despite the weight that workers’ associations have in Macau, there was never enough strength to pass a law that would establish a minimum wage for local workers, protecting them from overly low wages (domestic workers and those with disabilities were excluded).

What stays the same when everything (else) changes

Revisiting the opening text of this special report prompts us to ponder: amidst the whirlwind of change, what remains constant?

Macau Business | April2024 | Special Report | Modern Finance

Making it happen

If someone had predicted ten years ago that Macau would emerge as a central hub for hundreds of bond issues, few would have taken it seriously. Even more incredulous would have been the notion of Macau outpacing Singapore in international bond issuances, as it did last year, according to official data.

This feat was made possible only through decisive intervention and support from the mainland, leveraging every available resource. The idea of establishing a stock market, which surfaced at the decade’s end, now appears to be on the back burner. However, it is realised that Macau need not compete directly with Hong Kong to develop a financial sector that contributes at least 20 percent of GDP. Fintech is here and makes this job a lot easier. A step in that direction was taken last year with the establishment of the Micro Connect Macao Financial Assets Exchange (MCEX), an innovative financial market based in the SAR, linking global capital and small businesses in the mainland.

Micro Connect founder and chairman Charles Li shares his vision and aspirations in an exclusive interview for this edition.

Over the past couple of years, local authorities have been enacting crucial new legislation and launched the Macao Central Securities Depository and Clearing Limited (“MCSD”).

Nevertheless, a critical issue persists – this special report underscores: without bolder efforts to attract highly skilled professionals, Macau’s development remains hampered.

Expectations are high for Ho Iat Seng, who history may regard as the architect of modern finance in Macau, after the inaugural Chief Executive… a banker.

Co-ordinated by João Paulo Meneses  jpmeneses@macaubusiness.com

Bonds instead of the stock market

The ‘dream’ of establishing a stock market in Macau lasted from 2019 to 2021, only to be swiftly replaced by a highly viable alternative: bonds.

“There are several challenges that must be addressed”

Hugo Maia Bandeira, a local lawyer specialised in banking and finance, stresses that Macau has benefited from mainland China’s strong support in developing the bond market. There is potential for companies from Brazil and Portugal to issue bonds in Macau, but a few hurdles must be tackled to make the SAR attractive in this field, says Mr. Bandeira, a founding partner at CFB Lawyers

Bonds Across Borders

Until now, Mainland China has been fuelling the bond market established at the end of 2018. However, there is a need to diversify and attract new investors

Green light to green bonds

The hardest part is done: Macau is starting to distinguish itself in the green bond niche market

Fintech in our lives

Macau has experienced the ‘fintech flavour’ through electronic payments, but there’s more in the pipeline.

Managing wealth

Macau’s wealth management scheme struggles to lure non-residents

Is Hengqin the (financial) future?

Amid growing efforts to bolster Macau’s financial sector, is Hengqin emerging as a pivotal player in this journey?

A monetary union?

Will the Greater Bay Area move towards a unified monetary system in the foreseeable future? The idea has been floated, but experts believe it will take time, with one scholar suggesting at least 20 years

Human capital conundrum

Shortage of highly skilled professionals has been a persistent issue in Macau, especially in high-value industries such as financial services. Will the new talent attraction scheme finally untangle this knot?

Macau “offers significant opportunities for fintech companies”

In an interview with Macau Business, Professor Wenjin Kang, an expert in the application of fintech in asset pricing, anticipates promising prospects for the future of modern finance in Macau.

Macau Business | March 2024 | Special Report | Public works

Old headaches, new remedies

The January 2017 special report editorial bore the title: “In the land where all works are postponed and no deadline is met”

The text aimed to characterise a situation in which delays of years were deemed normal, and deadlines announced at the highest level in the media were systematically disregarded.

Seven years have elapsed, and some changes have occurred.

Firstly, there has been increased attention paid to these same delays and budget overruns, resulting in heightened supervision.

The government also exhibits a different attitude today: more demanding, more interventionist, and more transparent.

Many things still go awry, and it’s not solely old problems that take an extended period to resolve (as exemplified by the lingering issue of Ká-Hó prison).

However, challenges with large-scale projects can emerge anywhere.

The distinguishing factor lies in how we address them: with resignation, as was customary in Macau, or with a more proactive approach – from all angles, including the media, which bears the responsibility to hold public authorities accountable in the interest of the social contract with its readers.

Co-ordinated by João Paulo Meneses jpmeneses@macaubusiness.com

Against ‘Tofu Buildings’

The government asserts that delays in public works are no longer an issue, but the facts on the ground tell a different story

Three different stories

We’ve chosen three public works projects that, each in its own way, illustrate what public works are like in Macau.

Fines? Court!

There are exceptions, but the prevailing pattern is for the government to emerge victorious in court disputes with contractors.

The Watchdog

In the absence of other supervisory and control bodies within the executive branch, the Commission of Audit plays an irreplaceable role

The (public) work of legislators

Public works are a matter of concern for society and its representatives at the Legislative Assembly. Are they doing enough to ensure a mechanism of checks and balances? Is the Government increasing transparency?

“without sufficient internal and external checks…”

As delays in public work projects have been become normalised, changing mindsets  proves to be a formidable task

Pandemic impact

Since 2020, the pandemic has taken a toll on nearly all public works underway in Macau. While some projects experienced delays of only a few weeks, others, like the construction of the Coloane prison, faced interruptions of up to 175 working days.

Consultancy and supervision

Entities that carry out supervision also have a role to play, but not even the best in the world solve all problems

“It was a wrong bet not to bet on local architects”

You have to invest locally because if there is no continuity the information will be lost, says architect Rui Leão

More training for engineers and architects

There is a high demand for these professional areas in Macau. While local institutions have been expanding training and programmes in this field, the top two universities do not offer degrees in architecture

Macau Business | February 2024 | Special Report | Demography – Will the Year of the Dragon come to the rescue?

A glimmer in the demographic winter

The year 1988, marked as the Year of the Dragon, saw the highest number of births in Macau. Twenty-four years later, in 2012, more records were established. While there was no noticeable increase in birth rates in 2000, it is indisputable that the Chinese zodiac influences the demography of East Asia.

Currently grappling with a demographic winter (this year, for the first time, the young population will be smaller than the elderly), Macau might observe a new peak of births towards the end of the year. However, irrespective of the number of births, problems will persist: in 2025, fewer babies are expected to be born, all while witnessing greater longevity.

Demographic challenges have multifaceted implications, extending beyond the social and economic realms. The primary issues are addressed in this dedicated report, providing insights into whether it is possible to counter the trend and outlining potential government interventions: more financial investments (as seen in Hong Kong)? increased immigration? additional working hours to subsidise reform?

The reader will discover answers to these questions in the subsequent pages of a special report that had the privilege of featuring a panel of Macau’s leading academic scholars with an interest in demographic implications.

Co-ordinated by João Paulo Meneses jpmeneses@macaubusiness.com

Do ‘Dragons’ have a better fate?

Parents believe so, but scientific studies say it’s nothing more than superstition

Special Report – Dragon baby boom: 1988 and 2012 (but not 2000)

In 2000, the auspicious belief surrounding dragon babies did not succeed in easing parents’ worries about childbirth during an economic recession

Macau’s demographic profile

The figures speak volumes, and they indicate that, since 2021, the issue has become more severe than ever before.

Pensions: Awaiting 2026 (or 2028)

Macau had been slow in implementing a mandatory pension system, delaying what seems inevitable

Reemploying senior citizens

Something has to be done in the medium term: raising the retirement age is one option, another is to focus on senior citizens returning to work

What can the Government do (more)?

There are many measures that can still be taken; it remains to be seen whether they will yield results. Opinions are divided

HKD20,000?

The Hong Kong Government is offering HKD20,000 for every child born since October. Wasted money, say experts interviewed by Macau Business

Bad news…

China entered an era of negative population growth. Will China get old before it gets rich?

Japanification”

Macau is far from being an isolated case. In fact, East Asia is the place in the world with the most pronounced ageing, and where there is the only country qualified as a “super-aged society,” Japan. In 2050, there will be 11 with these characteristics in the region (including Macau).

Is immigration the solution for low birth rate?

It is known that many countries, especially in the Northern Hemisphere, rely on immigration to solve demographic problems, whether related to the ageing of the population or, above all, to the low birth rate. Since Macau is experiencing similar problems, is immigration the solution?

Macau Business | January 2024 | Special Report | New gaming concessions – The first year (and beyond)

“For the times they are a-changin’”

This is the first year of the decade-long new gaming concession contracts, with the incumbent six gaming companies operating but under new terms. The first year of the ‘new era’ of Macau’s core industry also coincided with the city’s post-pandemic reopening. One year is not long, many will say, but enough to realize that several things started to change, if compared with the previous contracts (of 20 years).

 One of them is the interventionist role of the Government, which now is more proactive in supervising  what operators do and put forward demands for urban revitalisation—never seen before. Another new development is the pressure to attract tourists outside of Greater China—the Government wants two million in Macau throughout this year. An aim that comes in the face of a shortage of long-haul connections at the local airport.

Another novelty is the early end of junkets, which is not the same as the end of high rollers. Last note: tourists from Mainland continue to arrive in large numbers, but here too there seem to be changes—there are more young people than before, experts say. And this will lead to the need for more adaptations.

Co-ordinated by João Paulo Meneses / jpmeneses@macaubusiness.com

Is 10 years a short time?

It may not suffice to create an entirely new economic model that is significantly less dependent on gaming, but it will be enough for everyone to make a lot of money

First step: revitalisation of historic areas

The government has placed all its chips on the revitalisation of “community areas,” which are now the responsibility of the six operators.

Now it’s time to revamp

Except for the special case of Galaxy, which is still expanding, operators are now focusing on the renovation of certain spaces, beginning with some of the rooms that were exclusively used by the junkets

How to attract international visitation?

While the emphasis on drawing foreign tourists is a top priority, industry observers highlight that Macau’s market will continue to be oriented towards Greater China

Mass market, the new king

… but that doesn’t mean VIP gaming is dead or has become irrelevant

Foreigner-only gaming zones, the novelty

More than a novelty, these areas exclusive to foreigners are original. It remains to be seen what the effective impact is

Junkets: On the verge of extinction, or not

The role of junkets is at this point little more than residual. There are even those who predict that they will eventually disappear, unless they reinvent themselves

New Gaming Law, a Beijing tailored suit

With the new law, national security takes centre stage

The young Chinese tourist has arrived

Millennials and Generation Z patrons may be less interested in gambling, but downplaying their role would be a mistake

Government: Hands-on

Previously, the government was seen as relatively passive, but now it has become proactive. With the new Gaming Law and additional strings attached to the concession contracts, the authority has gained “increased powers to intervene.”

Macau Business | December 2023 | Special Report | Portugal in Macau

Distinctive Feature

As Macau edges closer to the halfway point of the 50-year special period, we take stock of what remains of Portugal, a country that administered Macau for over four hundred years, and the future prospects for development and cooperation.

Unsurprisingly, with Macau returning to the full exercise of Chinese sovereignty, integration with mainland China deepens, with the city organically becoming “more Chinese.”

Amid this, Portuguese features equip the SAR with assets that differentiate it and, in fact, are an important component of its identity, while also embodying the practice of One Country Two Systems.

This also brings into the picture how to strike a balance between distinctive features and integration as we move further down the road.

Twenty-four years after the handover, we review the role of remaining prominent Portuguese individuals and companies hailing from Portugal, while providing an overview of a waning presence in the judiciary, a generally positive sentiment regarding Portuguese legacy and heritage, and the new momentum arising from the increasing interest and focus by the SAR and Beijing in the Portuguese language.

Our readers will certainly come across some surprises in these pages. One of them is that when mainland Chinese tourists come to Macau, they value Portuguese cultural heritage more than Chinese cultural heritage.

As Macau embraces the “1+4” diversification strategy, Portuguese companies and skilled professionals can play a renewed valuable role, as stressed by the Consul General of Portugal in an in-depth interview for this Special Report.

Co-ordinated by João Paulo Meneses jpmeneses@macaubusiness.com

“We see obvious opportunities for Portuguese companies in Macau’s push for economic diversification”

Almost one year after taking office as Portugal’s representative in the SARs, Alexandre Leitão takes stock of the tasks, achievements, opportunities and challenges he has been dealing with as Consul General, serving some 154 thousand citizens, 90 per cent of whom are based in Macau.

The tourist allure of Portuguese cultural heritage

Several  academic studies substantiate that, alongside gaming and hotel amenities, the Portuguese cultural tradition stands as a pivotal factor for tourists opting for Macau.

“A very positive attitude towards Portugal and its legacy”

While Portuguese may feel that their cultural identity is fading away in Macau, several studies suggest otherwise

Portuguese, the language of status

The conclusions of a recent study may come as a surprise to many. It turns out that the language with the highest status in Macau is Portuguese

The legal pillar

Bilingualism in the judiciary has always been a demanding task before and after the handover. As time goes by, Portuguese is less used in the city’s courts

Government: words and deeds

The government has praised the role of the Portuguese community and authorities have been continuously supporting Portuguese-related institutions and initiatives over the years. However, a recent change of policy regarding new residency permits raised some eyebrows

Between ‘orphanhood’ and ‘integration’

Some researchers argue that the feeling of being “orphaned” is stronger than ever, while others suggest that the Portuguese in Macau are increasingly more integrated into the local community.

Two young Macanese share their experiences and feelings of belonging to this community

The Macanese community is often likened to bamboo, given the instability it faces without breaking.

Business foothold

The presence of companies hailing from Portugal has dwindled over the past 24 years. Just over a dozen major Portuguese companies currently operate in Macau, with the largest being BNU and Hovione. On the other hand, many Portuguese individuals have established and joined local business activities since 1999

Macau Business | November 2023 | Special Report | Our good and old Grand Prix

One-of-a-kind

More than an annual flagship event, the Macau Grand Prix has become a component of the city’s identity and a symbol of the “Tourism+ Sports” initiative. It also showcases the SAR’s external image as the Guia Circuit is recognized as a unique and special track.

As the MGP celebrates its 70th edition, spanning two weekends – just like in  the 50th and 60th editions – this special report delves into various aspects, including the event’s historical significance, its impact on the local economy, tourism development, and residents’ livelihoods.

As mentioned in this report by Ubaldino Couto, a prominent Macau-based scholar specializing in the MGP, even though residents in general tend to complain about the GP being a nuisance due to traffic congestion and overcrowding express their desire for the MGP to continue.

Surveys indicated that “everyone wanted the MGP to continue, retracting their dismay by claiming, ‘it’s just for a few days’.”

This year’s edition, the first with all major international races after three years of pandemic restrictions, also brings an unprecedented involvement from the six gaming concessionaires. They have been called upon to cover nearly half of the costs. For the SAR’s coffers, this means that the government will be spending the lowest amount in several years.

Co-ordinated by João Paulo Meneses jpmeneses@macaubusiness.com

“There’s plenty of interest and excitement”

Pun Weng Kun is upbeat about the 70th edition of the Macau Grand Prix, with the return of flagship international races and drivers and an extended programme, which includes a number of outreach activities.

Tourists like it

As a consolidated brand over time, MGP has a great capacity to attract visitors

Residents: love and mixed feelings

Macau residents recognise the importance and benefits of the MGP, with traffic congestion being a flipside

“Why has there never been a Formula 1 GP in Macau?”

Twice top Formula 1 officials considered the possibility of hosting a race at the Guia Circuit, but the track’s features ultimately posed insurmountable limitations for such an endeavour

“The most important event in Macau”

Whether before or after the liberalisation of the gaming industry, the Macau Grand Prix (MGP) continues to play a key role in shaping Macau’s image as a tourist destination

Spillover effect

Every pataca spent on MGP is multiplied by two. When media coverage is included, the return is six to seven times the investment.

The bills

Expenses regarding works rank first, followed by marketing and advertising

The Ladies’ Race

Just three years after the first MGP, a ladies’ race was organised. According to reports, three competitors participated, and Macanese Fernanda ‘Speedy’ Ribeiro won, driving a Fiat 1000 TV.

Lessening “dependency” on Hong Kong

Upon arriving in Macau in 1974, Governor Garcia Leandro found that the Macau GP was overly dependent on Hong Kong

Tourism+Sports

The government is focusing on the development of the concept of sports tourism in Macau and is counting on the support of the six gaming concessionaires

The Macau GP “belongs to Macau and its people”

Ubaldino Couto stands out as a leading Macau-based scholar on research related to the Macau Grand Prix. The IFTM professor believes that “residents feel very proud of this historical event, very much invested in their lives and history”

Macau Business | October 2023 | Special Report | A decade of Belt and Road Initiative

The largest-ever global infrastructure endeavour

Exactly 10 years ago, President Xi Jinping launched what would become the largest-ever global infrastructure undertaking. Never has humanity benefited from such an ambitious and vast program. While the overwhelming majority of countries sought to join both the maritime and land aspects of the Belt and Road Initiative (BRI), some, especially in the West, expressed doubts. One concern gaining strength was that the BRI is often accused of engaging these countries in a so-called debt-trap diplomacy, a charge that China vehemently denies.

However, this criticism has prompted China to set new goals, and the 2023 BRI intends to be very different from what was initiated a decade ago. This special report delves into history, re-evaluates priorities, and introduces new challenges while acknowledging the potential role that a small city like Macau can play in this global project.

Co-ordinated by João Paulo Meneses jpmeneses@macaubusiness.com

BRI: How much has China spent so far?

The latest projections point to values around USD 1 trillion. A more accurate figure may be known later this month

BRI: A decade in four dates

It all began a decade ago with the Silk Road Economic Belt and 21st-Century Maritime Silk Road Development Strategy, initially abbreviated as the One Belt One Road or the OBOR strategy. Since 2016, it has been officially designated as the Belt and Road Initiative (BRI).

The future, in the short term

China had already anticipated challenges regarding the development of BRI, but the pandemic was not in the cards

Criticism from North and West, praise from East and South

Despite receiving some support in the northern hemisphere, BRI’s fiercest critics can be found mainly in the West. Elsewhere, it has mostly garnered praise

Green challenges 

China’s overseas energy engagement in BRI countries in the first half of 2023 was the “greenest” since its inception.

BRI + Sustainable Development

Different projects with a similar vision and some basic principles

GBA, “an important support pillar for the BRI”

The Greater Bay Area project is set to play a relevant role  in the development of the BRI.

BRI “created a greater scope for development for Macau”

OPINION – By Edmund Li Sheng

Macau: Secondary or irreplaceable role?

There are those who perceive Macau (and Hong Kong) as playing a secondary, albeit active, role in building the Belt and Road Initiative (BRI). However, there are also those who oppose this view and speak of more significant ambitions.

“BRI has changed, and it will change even more”

Francisco Leandro, Associate Professor, Department of Government and Public Administration, Faculty of Social Sciences at the University of Macau, is a leading expert on Belt and Road Initiative-related studies and research. In this interview with Macau Business, he anticipates further changes to the initiative, including a stronger focus on the “Green Silk Road” dimension.

“It was a decade of significant results in sharing BRI results among all participants”

Professor Chao Peng is the Director of the Macau One Belt, One Road Research Centre at City University of Macau. This is a subject that Professor Chao has been researching for several years. He was interviewed for this special report, and, as noted by the scholar, his responses only represent the author’s personal views. 

Macau Business | September 2023 | Special Report | Forum Macau: 20 years on

Achievements, shortcomings and potential

Established in 2003 by the Chinese Central Government, the Forum for Economic and Trade Cooperation between China and Portuguese-Speaking Countries (Forum Macau) has emerged as a new mechanism in international relations, adding a multilateral layer to existing bilateral ties.

The Forum initially comprised China and seven Portuguese-speaking countries but expanded to include nine Lusophone nations with the admission of Sao Tome and Principe and Equatorial Guinea.

The then newly-formed Macau Special Administrative Region was entrusted with the mission of serving as a platform for Sino-Lusophone relations. Macau’s role has consistently received praise from both central and local authorities as trade soared, and numerous events involving thousands of officials, professionals, entrepreneurs, scholars, and artists have taken place in Macau under the auspices of Forum Macau.

However, the effectiveness of the SAR as a platform remains a subject of scrutiny. While Beijing’s directives have been consistently clear, critics point out that the city still lacks a substantial critical mass of experts and an actively engaged business community in Sino-Lusophone ties.

Two decades on, we take pulse of this project, primarily through the perspectives of scholars and businesspeople. A key takeaway from this special report is that while scholars and those connected with the Forum’s structure emphasize the project’s relevance and outcomes, business representatives tend to express a level of disappointment with the results, even as they acknowledge its significance and potential.

In the following pages, we review the outcomes and delve into diverse perspectives of experts and entrepreneurs on the achievements, shortcomings, and suggestions for the improvement of this key project, as Macau further integrates into the Greater Bay Area, a trend that is also reflected in the Forum’s activities and direction.

Co-ordinated by João Paulo Meneses jpmeneses@macaubusiness.com

Being a Platform: What’s in it?

It is increasingly evident that the most fruitful outcomes extend beyond the economic or commercial realm

Praise and lingering doubts

Lao Pun Lap took stock of the Sino-Lusophone platform with critical remarks and suggestions for improvement in an extensive article. The senior economist called for a new impetus to easing doubts over the project’s effectiveness.

Economic but also political

Experts point to ‘soft power’ and ‘cultural diplomacy’ as keywords to accurately understand the Forum

Portuguese language, “First Great Achievement”

Portuguese is today much more sought after than before 1999. Portugal is grateful, even though it has done little for it.

Will Brazil move past scepticism and embrace the Forum?

Brazil is by far China’s top partner among the Lusophone nations, but it has shown little interest in the Forum for most of these two decades, observers point out. How to effectively bring Brasilia on board? A recent meeting between Ho Iat Seng and Brazil’s Innovation Secretary seems to indicate interest in stronger ties.

Smaller-sized PSCs have more to gain.

Brazil and Portugal are on league of their own in terms of bilateral relations with China and Angola and even Mozambique are special cases. Amid this, Cape Verde, Sao Tome and Principe, Guinea-Bissau, and, outside Africa, East Timor are seen as the main beneficiaries of the Forum Macau

FUNDamental questions

Out of sync with business reality, closed off from information, and lacking flexibility—these are some of the criticisms that have been directed at the China-Portuguese Speaking Countries Cooperation and Development Fund since its establishment a decade ago. Making it more accessible and flexible is on the agenda of the PSC and the Forum

Export credit insurance, guarantee fund: How? When?

The last attempt to create an export credit insurance scheme was launched in October 2019 but it has been on the back burner over the pandemic

“The Forum pioneered a new model of intergovernmental cooperation”

Professor Ip Kuai Peng, the Dean of the City University of Macau’s Institute for Research on Portuguese-speaking Countries, speaks highly of the work carried out by the Forum over these 20 years

Promoting reform

If the suggestions left by the mainland experts in the External Evaluation Report are implemented, there will be a “renewed” Forum

Macau Business | August 2023 | Special Report | Creative Industries

A Transformative Moment

On August 28, 2003, Creative Macau was established under the initiative of the Institute of European Studies of Macau, bringing the role of creative industries in the process of economic diversification to the city’s agenda.

By late 2010, the contribution of cultural and creative industries started to take a more central stage in the public discourse, but its role is yet to be properly gauged and quantified.

The Cultural Bureau, for example, speaks of the “promotional effect that the policies and measures of the Macau SAR Government have had on cultural industries,” and states that the revenue generated “clearly reflects the economic contribution of these industries.”

However, Ho Iat Seng, in his first Policy Address, recalls that “the contribution of nascent industries to the overall economy is still relatively low.”

One thing is certain, however: the creation of Creative Macau has transformed the industry, stirred up universities, and given opportunities to Macau’s artists and consumers.

In this special report, we take stock of what has been achieved over the past two decades, without neglecting to address issues such as government subsidies or the need to nurture start-ups and generate business.

P.S. – Lúcia Lemos has been at the helm of Creative Macau for 20 years. Macau should thank her. We, at Macau Business, thank her for the collaboration for this special report.

Co-ordinated by João Paulo Meneses

jpmeneses@macaubusiness.com

Creative Macau: 20 years in four key moments

Summarising 20 years of activities in four defining moments is not easy, especially for an institution that has organised numerous events over these two decades.

“We have enormous potential for creative industries to develop”

20 years ago, when the idea of promoting the creative industries arose in Macau, Lúcia Lemos was the person behind the project. Two decades on, she provides an overview of the path followed by the Centre for Creative Industries – Creative Macau.

From Edmund Ho, to Chui Sai On, to Ho Iat Seng, the differences

The concept of the creative industry has evolved over the years, influenced by changes in government leadership.

Government policies and measures

Millions of dollars have been allocated to the craft and creative industries over the past decade. However, it has been acknowledged that the Macau authorities themselves did not always allocate the funds in the most effective manner.

A micro-nano contribution to diversification

The economic contribution of the creative industries is approximately one per cent. Can it be increased? Experts highlight structural issues

An overview of Macau’s creative industry

At the request of Macau Business, Joseph Sy-Changco, Assistant Professor in Marketing at the University of Macau’s Faculty of Business Administration, provided an enumeration of the strengths, problems, and challenges of the creative industry in Macau. Additionally, he offered a list of strategies and initiatives that can be implemented to enhance the creative industry’s growth in Macau.

Market-driven approach to offset subsidy dependence

A greater connection to tourism and casinos in particular can open up other opportunities for Macau’s creativity

Universities: the need to create talent

There can be no creative industries without cultural agents, and one of the most effective ways to foster a network of cultural agents is through universities

Towards GBA, with a stop in Hengqin

Macau’s creative industries need exchange, attracting more people and even gaining other forms of financing

Aollywood: All or nothing

It promises to be the project that will change the creative industries in Macau. For now, it’s little more than press releases

“Macau, city of culture”

The former Secretary for Social Affairs and Culture dreamed of the possibility of “when we talk about Macau, we talk about art”. How far are we from that?

Macau Business | July 2023 | Special Report | Pataca, 170 years on – Quo vadis?

1553 – 1853 – 2013 -2053

Many historians recognize the year 1553 as the year of the establishment of permanent trading depots by the Portuguese in Macau. Over the course of the first 300 years, business transactions were conducted through barter or the use of silver as a currency. It wasn’t until 1853 that an official law was enacted, formally introducing the pataca as the currency of Macau. Remarkably, after 170 years, the pataca remains the city’s official currency.

In this special report, we delve into the historical context and shed light on the growing threats faced by the pataca, particularly due to the rise of digital payments and cryptocurrencies. A notable example of this is the Chinese project involving the central bank-backed digital yuan.

While the pataca may not be the most widely used currency globally in Macau, where the Hong Kong Dollar takes the lead, it holds a special place among residents who have developed a close bond and fondness for it. Experts warn that its disappearance would have profound consequences on the level of identity.

Why is the pataca under pressure? There are factions defending the pataca, primarily led by the AMCM, and opposing forces that aim to diminish its influence, such as digital currencies and the proposal to introduce the renminbi into the casino business.

After 170 years, the pataca still perseveres and resists the challenges it faces. The question remains: will it endure for another 30 years to celebrate its 200th anniversary? (Considering that 2053 comes after 2049…)

Co-ordinated by João Paulo Meneses

jpmeneses@macaubusiness.com

MOP resists HKD profusion

Gaming, in particular, works with HKD, increasing the risk of currency substitution over the pataca

Bogus banknotes

Legislators are discussing the best way to tackle the counterfeit currency problem

Hengqin: a win-win option, but when?

For at least eight years, there has been talk of the possibility of the pataca being accepted in Hengqin. The advantages for Macau are obvious, but there are obstacles. It remains to be seen whether the solution that will be found is comprehensive or intended solely for micropayments.

Four key dates in History

In the past 170 years, the pataca has experienced numerous ups and downs, including several crises. Let’s recall the most significant dates.

Who wants to buy a pataca for MOP3,500?

Pataca coins and banknotes are in great demand among collectors, especially Asians. a MOP100 bill from 1906 could potentially be traded for over MOP800,000.

A Question of Identity: MOP squeezed between HKD and CNY

The pataca is an icon of the city’s identity and autonomy, but it is facing increasing pressure from the neighbouring currencies in Hong Kong and the mainland, as well as from the ever-growing digital payment tools

The digital currency challenge

Will a stronger digital currency lead to a weaker pataca?

Digital yuan at casinos?

There is no shortage of arguments stressing the pros and cons that will result from the adoption of the digital renminbi in casinos.

New acts, 28 years on

Currency in digital format will finally be enshrined in law, alongside other updates aimed at preparing Macau to embrace ‘Modern Finance’

Monetary Authority explains

Macau Business addressed a series of questions to the Monetary Authority of Macau (ACMC) on topics that require clarification and generate interest on the part of public opinion. These are the answers to three pivotal matters

Macau Business | June 2023 | Special Report | Macau – Hong Kong | So near, so far

Side by Side (Back-to-Back)

The relationship between China’s two special administrative regions has often been referred to as one of ‘a tale of two cities’. At first glance, they appear similar but are conspicuously divergent. So near, yet so far.

During the COVID-19 pandemic, the 62 kilometres that separate the two cities seemed like a bridge too far. However, with the post-pandemic reopening in January, it was heart-warming to see the enthusiasm of visitors from Hong Kong returning to the once ‘sleepy enclave’ now thriving gaming/tourism hub. Likewise, Macau residents returning to the neighbouring SAR were excited about experiencing again the big city feeling across the Delta.

Weeks into the reopening, the Chiefs Executive of the two SARs visited each other’s cities in late February/early March, signalling the impetus for (re)connecting and enhancing not only cooperation but also coordination, which was significantly impacted by the pandemic.

At the end of the day, it is a fact that Macau still depends on Hong Kong in several sectors, such as currency, the international airport, and certain medical facilities. However, since the resumption of the exercise of Chinese sovereignty, Macau has become increasingly reliant on the mainland.

This would explain why the two SARs have lived not only side-by-side but also ‘back-to-back’. However, the truth is that this has always been the case, both before and after the 1999 handover.

Over the span of the first two decades, the tables have turned to some extent. If this article had been written 20 years ago, it could have been titled “Rich Man, Poor Man”, in reference to the famous novel by Irvin Shaw, where a rich brother and a poor brother are the protagonists. Today, it no longer makes sense to say that Macau is the “poor brother”.

Furthermore, the two SARs share not only the same constitutional arrangement but also their participation in the “9+2” Guangdong-Hong Kong-Macau Greater Bay Area, alongside nine cities in the neighbouring province.

As the two cities enjoy the momentum of (re)connecting, Hong Kong remains both near and far.

PS – Is there still room for some kind of rivalry? Those who follow the Macau Grand Prix races know that Macau spectators are thrilled when local drivers beat those from the neighbouring region…

Coordinated by João Paulo Meneses jpmeneses@macaubusiness.com

One pandemic, two systems

The management of the pandemic was a case in point of the divergent paths – and in some cases apparent lack of coordination – followed by the two SARs.

Less rivalry, more cooperation

In which areas do Macau and Hong Kong cooperate? Many voices make the case for ever-closer ties across the board

The Road to Regional Integration

The Guangdong Hong Kong Macau Greater Bay Area is set to be a defining feature of the road to 2047 and 2049, respectively. In the near future, the cooperation and integration between Macau and Hengqin, and Hong Kong and Shenzhen (Qianhai) will take centre stage. How far and how fast will it go?

Diversification: how to succeed in the shadow of Hong Kong?

The ‘1+4’ diversification plan announced by the Government does not face competition only from Hong Kong

Gambling: does sin live next door?

Hong Kong residents enjoy gambling even if they don’t come to Macau.

Connected and separated by history

The Portuguese had already been in southern China for almost 300 years when the British founded Hong Kong. But everything changed since then

HK tourists: the young and the old

Older people still come to Macau to play, but the profile of the visitor is changing: younger people want different experiences.

Can the ‘good student’ teach Hong Kong?

Macau has been dubbed the ‘good student’ or ‘poster child’ of the One Country Two Systems policy, compared to the neighbouring SAR. Experts hold different views on this assertion’s meaning and outcome

Identity in transformation

It’s not just in Hong Kong; researchers have observed some notable changes in the identity of Macau residents, namely among the younger generations, in recent years.

Learning from each other’s experiences

“Macau’s government should learn more from Hong Kong by sending delegations to study the experiences of Hong Kong,” says Sonny Lo. Conversely, he tells Macau Business that “Hong Kong’s tourist officials should also learn from Macau’s experiences in developing historical and cultural heritage tourism—a phenomenon lacking in the Hong Kong SAR.”

‘Abundant Happiness Street’

In Macau, we have Rua da Felicidade (Happiness Street), Travessa da Felicidade (Felicidade Lane), Beco da Felicidade (Happiness Alley), and Pátio da Felicidade (Happiness Courtyard). Therefore, there is no lack of happiness. By the way, in Chinese, Rua da Felicidade is known as Fok Long San Kai [福隆新街], meaning Abundant Happiness New Street.

One of the first questions addressed in this special report is whether Macau residents, including the elderly, are happy. We then suggest approaches that can improve individual well-being, such as religion or mindfulness, and end up talking about what prevents us from being happy, such as stress at work, mental health, and the pandemic, and how to seek help.

When Rua da Felicidade was the local red-light district and not just a tourist spot, there were also two very different realities. At first glance, it was the heart of Macau’s love district, but during the day it hid several human dramas, as reported by historian Manuel Teixeira.

Then, as now, happiness can also hide a lot of unhappiness.

Co-ordinated by João Paulo Meneses

jpmeneses@macaubusiness.com

Are people in Macau happy or dissatisfied?

This is a subjective question with no definitive answer. In the midst of conflicting opinions, what does scientific research suggest?

Can happiness be measured?

Macau is not included in The World Happiness Report

It’s not easy to be old

Problems such as loneliness and dementia are a part of everyday life for older people.

Sport is good, but where?

The new reclamations could be a possible way to improve living conditions and achieve the creation of more green spaces, according to experts

Mindfulness, to be better (in basketball)

Mindfulness training can effectively improve athletes’ levels of mindfulness, emotional states, and psychological skills, according to pioneering research conducted in Macau.

Leap of faith

Religiosity was “significantly and positively related to satisfaction with life and overall health”.

“Macau residents are mostly happy”

“Religion may provide an answer, “says  Professor Spencer De Li, a leading sociologist based in Macau

Work shift = stress

All jobs can be stressful, but working shifts compounds the problem.

Mental health: A pandemic heavy toll

The first studies carried out during the second year of the pandemic are now beginning to surface. The results with university students are disturbing

The inspiring story of Fuhong Society

There are many non-governmental charities and social work entities in Macau, and some of them have a long tradition in the region. The Fuhong Society of Macau stands out.

Macau Business | April 2023 | Special Report | ESG/CSR Spotlight

Raising the bar

ESG (Environmental, Social, and Governance) criteria are fast becoming the bedrock of corporate integrity, reflecting the growing awareness of the importance of sustainability for our planet’s future. As such, it behoves us in Macau to act proactively in response to this evolving paradigm.

During the three-year pandemic period, gaming concessionaires, the city’s main employers, have adopted numerous ESG and CSR (Corporate Social Responsibility) measures. While some wonder if it was the outcome of genuine effort or mostly a response to the then upcoming public tender, the fact of the matter is that the new concession contracts, in effect since January 1, include several CSR-related strings attached.

The next few years will provide an answer to the commitment and effectiveness of this drive, not least because a number of non-gaming projects to be developed by the gaming and operators are framed within the CSR/ESG realm.

This special report discusses these criteria in diverse areas such as gaming and integrated resort operators, finance, start-ups, and steps towards nurturing a greener city.

Co-ordinated by João Paulo Meneses jpmeneses@macaubusiness.com

“A “Huge Responsibility”

The government put out a call, and the six gaming concessionaires promptly responded with a range of proposals aimed at advancing their corporate social responsibility initiatives.

“The CSR/ESG dimensions covered in the new concession contracts need to be effectively implemented and achieved”

Professor Jenny Guan from the School of Hospitality Management at the Macao Institute for Tourism Studies is one of the leading advocates for implementing CSR and ESG concepts in Macau. In an interview with Macau Business, she highlighted the challenges of evaluating the performance of gambling concessionaires without standardized criteria.

Gauging ESG performance

Gaming concessionaires have been reporting their ESG and sustainability commitments in recent years. A comparative study unpacks each operator’s performance in 2020

Seizing the opportunity

After Ho Iat Seng’s warning, casino operators doubled down on social responsibility tasks over the three pandemic years, with the public tender just around the corner…

IR footprint

Integrated resorts have been adopting a number of measures, but barriers continue to hinder the implementation of green policies. A study points to obstacles related to policies and regulations, management, resources, costs, and awareness.

“A responsible gaming city”

Experts applaud the Government’s efforts in this area

Paichais, the forgotten

Pathological gamblers are a fringe of society, but studies indicate that they can reach 7 per cent

Are casino staff more exposed?

There is no consensus. Different studies carried out in Macau show different results.

More green spaces

This year marks the 50th anniversary of the Government’s acquisition of Lou Lim Ioc, one of the city’s most famous gardens. Macau still lacks green spaces and public gardens.

Small is beautiful

It is not just governments and large organizations that can lead us towards a sustainable future. Small yet impactful examples can also be inspiring. Let’s meet three of them.

The colour of money…

… is green! Green finance is a new mantra. Also in Macau.

Macau Business | March 2023 | Special Report | Decarbonisation. When? How?

A big problem cannot be solved with small ideas

The time will come when all countries and regions will have to do their utmost to combat climate change and achieve decarbonisation.

Macau, which hitherto has shown a rather passive attitude in this respect, will not be left out.

And when it is called upon to effectively contribute, experts point to the installation of wind farms, eventually combined with other renewable sources, by making the most of the 85 square kilometres of waters surrounding the city which were granted to the SAR by the Central Government in December 2015.

So far this ‘gift’ has been closed and underutilized.

However, this situation is unlikely to persist for much longer, as the reader may find throughout the next 20 pages of this special report.

 PS – Macau is facing a general shortage of talent in technical fields, which is due to several factors, including the small size of the city. This lack of experts is hampering the city’s growth and development in various sectors. On the other hand, when it comes to environmental issues, Macau is home to world-class specialists. For instance, Yonghua Song, the rector of the University of Macau, is an internationally recognized authority on energy and low carbon power systems, while Joseph Lee, the president of the Macau University of Science and Technology, is a leading expert in Hydro-Environment Engineering. Macau should not waste these experts who are eager to contribute, as evidenced by their valuable inputs to requests for collaboration from Macau Business.

Co-ordinated by João Paulo Meneses (jpmeneses@macaubusiness.com)

Decarbonisation: the fear of setting goals

Macau has yet to establish detailed targets towards decarbonization and there is no information on when a comprehensive roadmap will be announced

GHG: The case for adopting a priority regulatory policy

That’s not all. Authorities must strengthen the current energy conservation policy, according to one of Macau’s most authoritative voices on greenhouse gas emissions

Don’t focus only on CO2, look into O3

While other air pollutants reduce their impact, ozone levels remain hazardous.

“Macau has the basic conditions to take the lead in achieving carbon neutrality among other cities in China”

To achieve this goal, several measures are required, including the development of low-carbon or even zero-carbon buildings, states Professor Yonghua Song, one of Macau’s most authoritative voices on decarbonization

Electrification of land transportation

Transboundary pollutants play a major role in the background concentration of Macau, but the city has to play its own role, mainly in transportation sector

Wind energy: “We need to use the 85 km2 of waters”

A revolutionary idea that deserves to be studied. Without the help of these 85 km2, how and where will Macau produce renewable energy in relevant quantity?

More trees, less CO2

Macau lost 29 hectares of trees, which resulted in the emission of about 44 tons of carbon dioxide.

The case for deepening collaboration with the mainland

There is already cooperation between the two regions and Guangdong, but it is necessary to go further to obtain more and better results, say experts.

Waiting for a waste charging scheme

Macau has done a lot to combat the use of plastics, but a step forward is needed

Tackling potable water scarcity

The Greater Bay Area is facing a massive demand for fresh water, and potable water scarcity is a challenge that Guangdong has been dealing with. The Datengxia water conservancy hydropower project, which is currently in the pipeline, is seen as a key step, to be followed by additional measures

Macau Business | February 2023 | Special Report | Digital Macau

Aiming at the cutting edge

The Chief Executive recently quoted what President Xi Jinping emphasized in the report to the 20th National Congress of the Communist Party of China: “We must consider science and technology as our main productive force, the qualified cadre as our main resource, and innovation as our main engine of growth.”

Ho Iat Seng has made the commitment to science and technology a priority, thus becoming one of the hallmarks of his three years in office.

In the latest Policy Address, the 1+4 concept took centre stage: If the ‘1’ refers to promoting the diversified development of the tourism and leisure sector, the ‘4’ represents perseverance in promoting the development of four nascent industries: big health industry; modern financial services; high technology; conferences and exhibitions, commerce and trade, and culture and sports.

Let’s take the example of the commitment to e-government: the topic began to be talked about exactly two decades ago, but only in the last few years has the formula made big strides.

This special report shows that much has been done, but that much more remains to be achieved.

A way to gauge the effectiveness of research and development is through the spin-offs generated by universities. Macau is still somewhat at an infant stage in this respect, with one case clearly standing out: Digifluidic, a dynamic biotechnology company installed in Hengqin.

Digifluidic is the result of the most strategic and profitable effort in science and technology made in the history of Macau, by the Institute of Microelectronics (University of Macau), thanks to the visionary work of Professor Rui Martins and his right-hand man, Professor Pui In Mak.

This special report talks about these and other success stories but also some shortcomings, such as the delay in launching the 5G network, which was something of a trial by fire for the current Government, which, nevertheless could not prevent Macau from being the last city within the Greater Bay Area to have 5G up and running, two and a half years behind Hong Kong.

Co-ordinated by João Paulo Meneses jpmeneses@macaubusiness.com

A technology-driven market

Regardless of the results that were to be achieved, technology virtually became the most used word by the Ho Iat Seng’s government

COVID-19, a blessing in disguise for FinTech

2023 could be the year when finance and technology fruitfully meet in Macau

Science of “Biblical dimension!”

Several projects show that top-tier science can be conducted in Macau. UM is a global leader in chips and semiconductors. 

“Macau is already a smart city”

Many steps have been taken, but there is a problem that is limiting the development of the project.

The paradise of mobile payments

The pandemic made mobile payments commonplace, but the Government was able to understand the trends and intervened decisively

e-government: all chips in the ‘Macau One Account’

It all started exactly two decades ago, but only in the last few years has the e-government formula developed. Much is done, much remains to be done

GBA: Opportunities and challenges

GBA opens up immense possibilities for Macau but also heightens the SAR’s longstanding limitations, such as shortage of talents

Making sense of ‘big health’

Judging from official documents, ‘Big Health’ often appears associated with Chinese Medicine, but this concept has much more to offer

5G: from pioneer to late comer

Macau missed out on being at the forefront of 5G by delaying the adoption of this critical technology

Meta… what?

Not just the metaverse but also Radio Frequency Identification chips and gaming tables or AI/ Facial recognition technology. A Brave New World is taking shape.

Macau Business | January 2023 | Special Report | Three years of pandemic – What changed?

Living a in bubble

Some will say ‘it’s only been three years’, while others, fed up with this pandemic, think that three years is too much.

We tried to take both perspectives into account when we set out to understand what has changed in Macau in these three years – and, by the way, we include, at the end of this special report, some situations that have changed in the world but not in Macau.

After all, when did places in the world manage to live in a bubble for three years, while the rest of the world returned to normalcy? Tourism numbers in Europe surpassed last year those of 2019, for example.

What happened in Macau was excellent from a health point of view, but disastrous in economic terms (with all that that means of unemployment or bankruptcies). At the same time, it forced many entrepreneurs to look for alternatives (such as live streaming sales or delivering food by apps).

Macau discovered distance learning, adapted to live with far fewer non-resident workers and resisted vaccines, not knowing how to deal with traditional Chinese medicine remedies: they treat or only prevent?

Macau started to eat at home, abused smartphones and realized that it has a serious problem on its hands: the piles of waste food that accumulate every day is not the fault of tourists, but ours.

Welcome to such new normal.

Co-ordinated by João Paulo Meneses jpmeneses@macaubusiness.com

Vaccination hesitancy

There were repeated appeals, raffles with incentives for those who had been vaccinated, but hesitancy was real, and Macau took much longer than expected to achieve herd immunity (at least 75 per cent)

Mental health woes

Suicides and suicidal ideation, as well as depression, anxiety, and insomnia symptoms, were all aggravated by the pandemic.

Problematic Smartphone Use

To understand the implications of the increased smartphone use during the COVID-19 pandemic, a pioneering study showed an elevated risk of Problematic Smartphone Use (PSU) among the Chinese adults in Macau

Live streaming sales flourishing

Macau discovered live streaming sales during the pandemic. For many businesses it was a much-needed lifeline

What are we having for dinner, Aomi or mFood?

Dining experiences in an O2O environment has changed the thinking and behaviour of customers, state local researchers.

Non-resident workers, the “expendables” the city needs

The pandemic ended up heightening Macau’s bipolar relationship with its non-resident workers.

The Online teaching conundrum

It was the first time that distance learning was used intensively. Very few were prepared

No tourists, why so much waste?

There are no longer 30 million tourists entering Macau, but solid waste is still too high.

Lianhua Qingwen, myth or reality?

Public opinion may not know exactly what to think: after all, can Traditional Chinese Medicine (TCM) formula Lianhua Qingwen help to prevent and fight the pandemic? “Its main benefits are to clear heat, detoxify, and remove lung heat,” said the Health Bureau

The world changes (slowly), Macau observes

Many of the changes escape the MSAR, either due to lack of interest or, mainly, due to the geographical and social characteristics of the city

Macau Business | December 2022 | Special Report | Macau as Creative City of Gastronomy

Five years

One of the most distictive features in the projection of Macau’s tourist image is its gastronomy. And UNESCO’s decision to include the city in the network of Creative Cities in this area was a decisive argument.

As this special report points out, Macau has many different cuisines.

Still, one stands out:  the Macanese cuisine, which has a 450-year history.

It turns out that, as the reader will notice, there are several constraints to the development of this gastronomy, which, by the way, is also part of the Macanese community’s identity.

One thing is certain: the Macau Government Tourism Office has been tireless in its promotion over the last five years, with the assistance of various institutions, with the Macau Institute for Tourism Studies playing particularly meaningful role.

Much remains to be done, but the groundwork has been laid and a path has been blazed thus far.

Co-ordinated by João Paulo Meneses

jpmeneses@macaubusiness.com

Not just one but many cuisines

… so many that it is not always clear what we are eating

Macanese cuisine: undoing the confusion

A Macanese cuisine or two? Served in Portuguese restaurants mixed with Portuguese dishes?

A ‘touristic image’ issue

In an age of ‘Instagrammable’ food, it’s not always easy to project a positive and authentic image.

Where to eat Macanese food?

Macanese dishes can be found in dozens of restaurants across the city but it’s no so easy to come across Macanese cuisine-only eateries.   

A creative or a ‘stagnant’ cuisine?

The Macau government singled out cultural industries as a pillar for economic diversification. Gastronomy, namely Macanese cuisine, has a role to play.

Food and non-gaming

The pandemic has taken a heavy toll on the city’s restaurant industry. New investments are needed for the sector to recover

Food tourism

Food tourism has gradually become the primary reason for people to travel, experts say

A new (old) identity

Identity in Macau remains a complicated matter. Can food help?

MGTO and the “resurgence” of Macanese cuisine

Macau’s tourism authorities have played a leading role in promoting Macanese cuisine over the years

Macanese cuisine is still “quite invisible”

Perhaps because she is neither a native of Macau nor Portuguese, Annabel Jackson, one of the leading voices in the study of Macanese cuisine, can say things like this: “it’s a very honest cuisine, but maybe it isn’t a great cuisine”

Macau Business | November 2022 | Special Report | Macau’s insurance industry

Enduring and thriving amid the pandemic

How can one understand that the first text of this special report on the insurance sector in Macau is entitled “2021: the ‘good’pandemic..” and the last “The insurance industry is able to maintain steady growth in spite of the pandemic” (from an exclusive opinion article by the Director of the Insurance Supervision Department of the Monetary Authority of Macau)?

If it is true that the pandemic has been disastrous for the economy in general (not to mention people), there are some rare exceptions that seem to be left unscathed to a great extent—insurance, namely life insurance, is one of them.

As Félix Pontes, former AMCM’s Executive Director and Insurance Commissioner, explains in this special report, local companies offer “much more diversified products than the Chinese insurance companies: wider range of insurance cover and more options in terms of currency of the insured capital, namely in the American dollars (in China, the insurance policies are only denominated in Renminbi).”

In the following pages, we will also address pandemic-related risks, opportunities, and challenges for local insurance firms in setting their foothold in Hengqin and the risks associated with the use of virtual currencies.

Co-ordinated by João Paulo Meneses jpmeneses@macaubusiness.com

2021: The ‘good’ pandemic

After losses in 2018 and 2020, profits came to the insurance sector in 2021. Explanation: The sale of insurance policies, taking advantage of the border restrictions between Hong Kong and the mainland.

… and the ‘bad’ pandemic

The pandemic may have been good for the accounts of some insurance companies, but the Monetary Authority warns of problems.

Good life

The end-2021 accounts for most insurers operating in the SAR’s life segment were rosy.

AMCM’s work

The market evolves so quickly that the regulator’s job is never done

Hengqin waiting for Macau insurers

As Professor Henry Lei explains to Macau Business, “as the new laws and regulations governing the insurance operations in the ICZ have not yet been released, the extent of liberalisation in the opening up process is far from clear, local insurance companies are hesitating to set up their service centres in the ICZ.”

The case for an export credit insurance scheme

There is still a lack of an effective system of protection for exports and imports, something essential to Macau’s role as a Sino-Lusophone platform

Mainlanders prefer USD-denominated insurance policies

If it is true that in 2021, the money that mainland visitors spent on insurance in the MSAR was six times higher than that recorded in Hong Kong, this is due to the sale of life insurance, especially denominated in US dollar

A universal healthcare insurance system?

Leading expert in health economics and finance notes that “It is not advisable to switch to universal healthcare insurance”, considering the advantages of the SAR’s healthcare model

Virtual currencies, yes or no? Yes and no

Opinions are divided on the pros and cons of using digital currencies in the insurance market

“The insurance industry is able to maintain steady growth in spite of the pandemic”

— Doris Chan, Director of the Insurance Supervision Department of the Monetary Authority of Macau

Macau Business | October 2022 | Special Report | Chinese Millenials

China’s future

“The world is yours as well as ours. But in the last analysis, it is yours. You young people […] are like the sun at eight or nine in the morning […] We put our hopes in you” (Mao Zedong)

Millennials are defined as the generation born between 1980 and 1999 (or sometimes more narrowly, between 1981 and 1996), and they differ from other generations in a variety of ways.

China labels its generations by the decades they were born in, and this special report focuses on the balinghou (those born “after ’80”, who grew up as China reformed and opened to the world under Deng Xiaoping) and the jiulinghou (those born “after ’90”).

These two cohorts in China represent some 400 million people, and for sheer size they’re important; it makes them one of the nation’s largest emerging consumer groups.

For a place like Macau that intends to remain a tourist city, the group is vital – something our MGTO knows all too well.

So, in this special report we try to get to know them a bit better: their tastes and the options available to them, at school and at work, and the difficulties and anxieties they face.

Rejecting characterization based on stereotypes, we always look for a scientific basis, but the truth is that defining 400 million by whatever methodology is not easy. It may even be impossible given the segment’s inherent contradictions: Are they selfish or altruistic? Are they consumerists or ecologically aware?

Above all, as several experts have warned, this group has a unique identity distinct from its counterpart in the west and mustn’t be measured with the same yardstick.

Co-ordinated by João Paulo Meneses jpmeneses@macaubusiness.com

No chip off the old block

The under-40s represent an almost total break with their parents’ generation

From divorce…

(still a taboo, at least in Macau, despite the strong influence of western lifestyles and living standards on residents’ daily habits)

Digital natives

First social networks, now the metaverse, are “becoming essential for the sense of being, for the existence, of youth”

Traveling, an essential part of their lifestyle

“Winning the hearts of Chinese millennial tourists is a critical focus of integrated resort businesses,” according to a Macau study

“Everything but gambling”

And when they do gamble, they spend less money or want games very different from the conventional offer

Taobao, their “favourite leisure activity”

Online shopping has become a national pastime among millennials in China

“Involution” (for losers)

“The irrational competition created by university students to strive for high-quality job resources has caused the phenomenon of ‘involution’”

Job + frustration = tangping

Millennials are frustrated with their jobs in big companies, but the big companies, too, have difficult times ahead

Alcohol, the main problem

But depression and student suicide also warrant attention from authorities

“The mental health problem has become much more severe among Chinese youth.”

Chinese millennials “are more able to be individualistic and more likely to uphold their individual rights,” according to Jianhua Xu, Head of the Department of Sociology at the University of Macau.

Macau Business | September 2022 | Special Report | Housing: A place to call home

Real estate, the social debate

“The Government can learn from the Singapore housing model. Nearly 80 per cent of Singaporeans reside in government-built apartments, whereas social and economic housing only account for about 20 per cent of the total number of residential units in Macau. Therefore, ensuring that the housing needs of low-income people are met is an urgent problem the Macau government needs to address,” Edmund Li-Sheng, Professor of Political Economy and Public Policy tells Macau Business.

It’s true that, overall, between 2011 and 2021 the number of households accommodated in economic housing (26,553) and in social housing (12,963) surged by 61.3 per cent and 121.4 per cent, respectively.

But that is not enough.

And for the first time in many years there is a Government-led construction plan taking aim at the problem.

It’s not an easy one to solve, however; note that from 2005 to 2015 Macau’s housing prices increased some six-fold according to data from the DSEC.

The real estate market has become a central fixture in social debate, and this special report reflects that focus.

As usual, we present the concerns and visions of several experts, along with several recommendations and statistics allowing for a more complete understanding of the issue.

Co-ordinated by João Paulo Meneses jpmeneses@macaubusiness.com

Homes for the young? Try Hengqin

Most of Macau’s young people find local real estate “unreasonable”, leaving many with just one option: buying “over the river”, in Hengqin

Housing, the poor relation

The average price per square meter of housing in the MSAR soared from MOP6,428.10 in 1999 to MOP107,522.00 in 2019 – a near 17-fold increase in 20 years

Past policies

In the ten years 2005 to 2015 Macau’s housing prices increased some 600%, according to data from the DSEC

“Sandwiched” and feeling the squeeze

They don’t have the money to buy a house, but they don’t fit the criteria for affordable housing.

Solve the problem by 2030

The Government intends to build about 45,000 [I assume] houses for the various income classes by the end of the decade, thus ending the shortage of low-cost housing

“Very important to take precautions before investing” in Hengqin

Even before the apartments Macau is building in Hengqin have hit the market, reports of attempted fraud are emerging

Urban renewal, the challenges

The government has finally put a draft of the Urban Renewal Law before the Legislative Assembly, but final approval awaits the resolution of lawmakers’ ongoing discussions and lingering doubts

202,727 households

The latest Census results show Macau’s housing market undergoing a profound transformation

A pandemic-induced frozen real estate market

And the downward trend is expected to continue, experts say

Housing? Give us green space

Residents want more green spaces, and no wonder: the total area of this kind of space in Macau declined from 128.98 ha in 2010 to 93.47 ha in 2015

Macau Business | August 2022 | Special Report | Hato’s “ghost” – 5 years on

Why the ghost lives

Last April, the Transport Bureau suspended its Ferreira Amaral Square bus station improvement project – which planned to reroute some buses below street level using the underground motorcycle parking facility – after the severe flooding recorded in June of last year.

A few months earlier, it was announced that preliminary design work for the East Line of the LRT will factor in the probability of future flooding on a time scale of 200 years.

The truth is that Macau has never been the same since 23 August 2017.

Events surrounding the landfall of super typhoon Hato, which became known as the “Hato incident”, had multiple repercussions on a wide variety of fronts: 12 fatalities and over 200 injuries were recorded, along with massive infrastructure damage, supply shortages and flash flooding, making Hato the deadliest typhoon to strike Macau in 53 years.

Five years on, we’re discussing some of the underlying problems, and what has been and remains to be done about them, in this special report.

Key voices addressing these issues include Secretary Rosário.”It is almost impossible” to prevent flooding in the city, because “Macau is a very low-lying region, our soil cannot absorb water and we still have a problem with water overflow,” he said in a statement from 2020.

Earlier, Secretary for Security Wong Sio Chak had assured us: “Right now, we are able to face a typhoon with the same intensity as Hato.”

Co-ordinated by João Paulo Meneses

jpmeneses@macaubusiness.com

Reliving August 23rd

The infamy of that day in Macau is persistent and far-reaching. So much so that at one point two years ago, then lawmaker Sulu Sou suggested the observance of August 23 as the Day for the Prevention of Disasters and the installation of an interpretive plaque at the Inner Harbour. No such proposals have (yet?) been accepted, but neither has the memory of that day begun to fade.

Five years not enough

No seawalls, no tidal gate. Not much has changed in the Inner Harbour since 2017

Lessons from science: peak wind intensity, maximum sea level and extreme high temperature

According to the SMG’s analysis of the super typhoon after the event, “Hato had exhibited rapid intensification before it made landfall. This phenomenon was caused by a combination of several meteorological conditions at the time. Some of them include the high sea-surface temperature region in the northern part of the South China Sea, the inverted trough accompanied by the increase of wind speed in the upper atmosphere, and the relatively low vertical wind shear in the northern part of the South China Sea.”

Lessons learned

About a year after Hato, Typhoon Mangkhut hit Macau hard. This time, however, a study revealed an improvement in the authorities’ disaster response and management perceived by 88 per cent of respondents

“The future frequency and magnitude of storms that influence the GBA region will be increasing”

Hato also had a profound impact on the academic community, which studied the phenomenon in detail and created national and international networks to help anticipate similar phenomena.

PTSD in the aftermath

Two different studies, carried out one year apart, establish the existence of post-traumatic stress disorder.

Mangkhut, the following year

The affected area by Super Typhoon Mangkhut was several times that of Hato

More mangroves to protect the coast

A Macau-based study proves that wave reduction is influenced by mangrove density

“Tourism destinations face risks if they are struck by extreme weather events”

… and virtually no other jurisdiction in the world is as exposed to dependence on the tourism industry as Macau, says Fitch Ratings

IMF links Macau’s future to climate change for the first time

IMF links Macau’s future to climate change for the first time

Macau Business | July 2022 | Special Report | Gaming in Macau: The new era

Fasten your seat belts

Could Macau be living its final days as a top casino destination?

As assertions go, it’s a rather dramatic one, but it points to real concern.

The city’s gaming industry is undergoing a transformation comparable perhaps only to previous watershed moments such as the granting of STDM’s (monopoly) concession in 1962 or the liberalization of the sector in 2001/02.

On both previous occasions, it was soon clear Macau would come out a winner.

And this time?

What space remains for those traditional hallmarks of Macau’s gambling industry, the high-rollers, the junkets and the satellite casinos?

In this special report we take stock of transformations-in-the-making resulting from the new gaming law, the push for economic diversification, the impact of polices adopted in the Mainland and the pandemic-induced economic crisis.

Meanwhile, the public tender for the granting of new gaming concessions waits just around the corner.

It seems certain there will be no return to pre-pandemic business as usual.

What lies ahead?

Les jeux sont faits.

Brace yourselves.

Co-ordinated by João Paulo Meneses

jpmeneses@macaubusiness.com

High-rollers: Adapt or perish

Will VIP gaming survive the overhaul of the city’s legal framework on gaming?

Next step: digital yuan?

More conservative than tech-savvy, how and when will Macau embrace the changes promised by the digital yuan?

Bracing for lower revenue, less investment

Overall taxes on gaming ended up increasing by one percentage point to 40 per cent under the new law, with the CE being able to reduce indirect levies. However, due to the changes in the business environment, Macau will need to learn to live with lower revenue from taxes paid by concessionaires

Non-gaming: do more with less money

“It is about time for operators to reconfigure and refurbish the existing amenities, and each redevelopment is going to cost billions; otherwise, tourists will simply go elsewhere,” according to a Macau-based scholar

Satellite… of love?

If the Government’s initial idea was, in the medium term, to do away with satellite casinos, this proved to be very controversial, not least because, before the pandemic, they represented almost 10 per cent of gross gaming revenues. For now only two out of the 18 satellite casinos have closed.

Almighty supervision

The Chief Executive may terminate a concession for the operation of games of chance in casinos due to a threat to national security or the security of the Macau SAR, according to the new gaming law. But some observers ask what constitutes such a “threat” and who will determine that.

Responsible, Sustainable

While CSR – Corporate Social Responsibility – is a well-known “buzzword”, there is another key concept closely linked with it that has emerged in recent years: ESG – Environmental, social and governance criteria. Gaming operators are tapping into it.

Is the crisis here an opportunity elsewhere?

Are Singapore, the Philippines and Vietnam rubbing their hands with anticipation at the limitations imposed on high-rollers? Will the Macau problem open up new markets in the region?

“Macau will continue to be the prime destination for high rollers from China”

Jorge Costa Oliveira played a leading role in drafting the Macau Gaming Law in 2001 as well as in the commission for the first public tender to grant casino gaming concessions in Macau back in 2001. Mr Costa Oliveira was also Commissioner for legal affairs at the Macau Gaming Commission for about a decade.

New junkets: “different” or “obsolete”?

Some say there will be no place for junkets in the “new Macau”, while others talk of mere “travel agents”

Macau Business | June 2022 | Special Report | Start-ups in Macau

Much done, lots to do

You get the feeling that, around here, people only started talking about start-ups during Chui Sai On’s second term.

And while it’s true that the notion of backing entrepreneurship as an alternative to the diversification of Macau’s economy has gained new prominence – especially through Economy and Finance Secretary Lionel Leong – many will be surprised to learn that Macau’s first incubator launched more than 20 years ago!

The pioneering endeavour may have been too far ahead of its time: it was only in 2015 that a real strategy came together around the decision to create the Macao Young Entrepreneur Incubation Center (MYEIC), which opened five years ago.

This more recent push serves as the starting point for our special report, a portrait of the local start-up ecosystem with special emphasis on the roles of the Government in funding and of the universities in incubation, along with some of the more “boring” legal issues (given that now more than ever we’re talking about crossing the border).

N.B.: The following pages present a selection of local start-ups chosen by us because they are representative of the local ecosystem’s diversity. We could have used other criteria, but no method employed would have been entirely objective – there simply isn’t one.

Co-ordinated by:

João Paulo Meneses jpmeneses@macaubusiness.com

Small is beautiful

Is Macau, with its limited amounts of space and people, really a good place to create and develop start-ups? Experts say it is

Waiting for government-managed investment funds

Already the main source of support for local start-ups, the government needs to do more and, above all, do it differently, experts suggest

The story began in 2001

Many will say start-ups only became a topic of conversation in Macau in the last decade, but it’s worth remembering the first local incubator was created in 2001

Peaks and (inno)valleys

Macau’s incubators face great competition from those in Hengqin, in particular from the Macao-Hengqin Youth Entrepreneurship Valley

GBA: “More choice, more room”

Macau’s entrepreneurs are not short of options: they can stay or they can go. Or they can stay and go at the same time, taking advantage of the many facilities available in the GBA

The platform

Local Government and other actors, such as universities, have been creating the necessary conditions for Macau to play a role linking start-ups in the Chinese- and Portuguese-speaking countries.

Some of Macau’s stand-out start-ups

There are hundreds of start-ups in Macau. We have chosen a few that represent various sectors and different levels of development.

Legal assistance: prevention or remedy?

Legal issues are often low on the list of a start-up’s priorities. Next come the unpleasant surprises

Universities lead the way

Almost all universities in Macau have an incubator – or are planning to have one soon.

Jerome Yen: “Macau is very suitable for entrepreneurship”

If the Center for Innovation and Entrepreneurship is the most important incubator in Macau, Professor Jerome Yen is responsible for its success. In this interview he talks about the past, but above all the present and the future, with an optimistic message: Macau has the right conditions to develop good start-ups.

Macau Business | May 2022 | Special Report | China-Portugal investment: All changed 10 years ago

2012: before and after

Chinese investment in Portugal has overcome it all: suspicion, scepticism, surprise.

Seemingly from one moment to the next, Chinese companies began buying Portuguese firms.

And that new moment was 2012, the year that witnessed completion of the purchase of a stake in Portugal’s largest energy producer (EDP) by China Three Gorges (CTG), making it the utility’s largest shareholder.

Broadly speaking, Chinese investment has been stable, discreet and faithful to its commitments.

While the first half of the decade featured moves on high-impact businesses in sectors such as utilities, energy, banking, insurance or health, recent years have seen more Chinese capital flow into real estate, through developers of luxury housing or purchasers under the “Golden Visa” programme.

10 years ago, many saw Chinese investment in Portugal as a fad.

Now  it’s here to stay.

The next level? More “greenfield” investments.

Co-ordinated by João Paulo Meneses

jpmeneses@macaubusiness.com

Ni hao pu tao ya (*)

In 2011 Portugal went bankrupt and the following year had to sell some of its most important assets. China positioned itself as a buyer from the beginning, and Chinese investors and companies have since put more than €12 billion into Portuguese businesses and real estate. Following the purchase of EDP, Portugal remained on their radar.

List of businesses

“We would like to attract more ‘greenfield’ investments”

A decade has passed since the first major Chinese investment in a Portuguese company, and the time has now come to change tack. But Portugal remains attractive to Chinese investment, according to Bernardo Mendia, secretary general of the Portugal-China Chamber of Commerce & Industry

Macau Business | April 2022 | Special Report | Macau’s branding challenge

To be or not to be (a casino city)

Mr Song and his wife had already discussed the possibility of coming to Macau and Hong Kong for a few days on vacation, but only now had the idea become viable.

The couple had taken stock of recommendations from family members and friends who had already been to the two Special Administrative Regions, and now they wanted to begin planning in earnest, searching the Internet for attractions, hotels, prices, etc.

That’s when something strange happens: it’s common knowledge Macau is the only city in China where gambling is legal, but the Songs can’t seem to find any promotions for casinos on the Macau Tourism Office (MGTO) website – even for one of the several big concessionaires.

Where had their search gone wrong?

The astonishment on the part of this (fictional) pair of mainland Chinese tourists is certainly representative of that of millions who search Macau on the web for the first time: their touristic image of the Region (their perception of Macau) is out of sync with official marketing messages.

They end up discovering that Macau is much more than casinos – and that casinos cannot advertise their core business. They’ll still stop by one of the casinos on their visit to Macau, but it will be just to have fun and experience something different.

This story illustrates what two Macau-based scholars call the “branding complex [that] plagues the city of Macau”.

As the push for economic diversification gains steam, the case for giving the Region an identity makeover grows ever stronger.

But how do you market Macau without the “Las Vegas of Asia” brand?

How do you fundamentally alter the city’s current “casino city” character?

Official messages tirelessly promote an “East meets West” city of heritage and culture, a world-class tourism and leisure centre and Sino-Lusophone platform.

Experts like Glenn McCartney, however, stress that “[the gambling element] doesn’t have to be excluded in the branding process”.

Answers to these questions and more await the reader in the next two dozen pages.

Co-ordinated by João Paulo Meneses

jpmeneses@macaubusiness.com

The MGTO’s place-branding strategy

Far more than a spot for gaming, Macau has primarily been portrayed officially as an “East meets West” cultural tourism hub

Without gambling

The image of a gambling city remains and will continue to be present for many years in the perceptions of tourists, even if the casinos disappear, experts say

Tourist perception in transition

No matter how many branding and rebranding efforts are made to associate Macau with ideas other than gambling, it remains the city’s strongest brand. But one thing’s for sure: it’s no longer the only one.

WCTL: mere rebranding?

Macau tourism has been trying to implement the World Centre of Tourism and Leisure (WCTL) concept for 10 years. There are already results, but the work is not complete

From the “Monte Carlo of the East”…

To combat the sinful image of gambling, a more neutral signature emerged: “East meets West” was a marketing cliché with political relevance, as current today as in the past

Raising the profile of event tourism

Macau is a city of year-round events. However, Government and destination marketing operators need to invest more time and efforts into promotion

A “City of culture”…

All studies agree: tourists already see Macau as a city of culture, largely influenced by the recognition, by UNESCO, of the historic centre.

Marketing for Identity

Marketing alone is insufficient to change a city’s image. We need to focus more on our unique features that can be easily remembered and distinguish us from other destinations

Hengqin – synergy and competition

If a hotel room in Hengqin can cost half the price of one in Macau, is that an insurmountable challenge?

Glenn McCartney: “[Casinos] don’t have to be excluded in the branding process”

He was among the first Macau-based scholars to systematically address the need to rethink Macau’s tourist image and make it coherent. In this interview, Glenn McCartney, Associate Dean of the Faculty of Business Administration, University of Macau, warns of the new challenges caused by social networks and the pandemic

Macau Business | March 2022 | Special Report | GBA 5 years young

Comfort zone

As a rule, the first five years in any long-term project are an opportunity to take stock of developmental milestones and challenges.

In March 2017, Premier Li Keqiang included the development of the GuangdongHong KongMacau Greater Bay Area (GBA) was incorporated into his Government Work Report at the National People’s Congress (NPC) opening session.

The consensus around the Greater Bay Area (GBA) – the planned megalopolis consisting of nine cities in the province of Guangdong, plus Macau and Hong Kong – is that it’s only just beginning and a broader vision will only truly come into view in the coming two decades

Still, the fact that only five years have passed shouldn’t deter us from highlighting what has already been achieved and pointing out ways to overcome the most obvious obstacles.

This special report does just that.

When looking at the challenges and achievements the COVID-19 pandemic factor would need to be factored in.  Mobility is another key matter.

This report also delves into the discussion of issues on which to reflect: 1) Why do 90 per cent of recent graduates from local universities choose to stay in Macau, with only 3.2 per cent going to Mainland China to work? 2) Macau’s water supply is nearly 100 per cent dependent on the North, and though the whole of the GBA faces complicated challenges in this respect, the subject could be addressed.

Signs are indeed hopeful, however: the GBA is China’s youngest, most educated and most talent-rich region.

And Macau’s function in the GBA has plenty of potential to be taken to a higher level.

The 2019 GBA Outline Development Plan spells out Macau’s role under the One Centre (global tourism and leisure centre), One Platform (trade cooperation platform between China and Lusophone countries), One Base (for exchange and cooperation where Chinese culture is the mainstream and diverse cultures coexist) motto. It is an ambitious endeavour, one, which is to be articulated with the overall plan regarding the Guangdong-Macau In-depth Cooperation Zone, launched last year.

Co-ordinated by João Paulo Meneses jpmeneses@macaubusiness.com

From PRD to GBA

Plans for regional integration date to well before the announcement of the Guangdong-Hong Kong-Macau Greater Bay Area. Key steps were taken, for example, in 2008 and 2011

Working in the GBA

Either because they don’t want to leave their “comfort zone” or because they lack the confidence, most local recent graduates do not yet consider the GBA (with the exception of Hengqin) a top choice for work

The GBA’s Achilles’ heel

While some cite “enormous institutional discrepancies”, others highlight the existence of three tariffs and three legal systems, which “has become an important obstacle to cross-border integration”

Heritage to set Macau apart

The future of tourism in Macau is increasingly intertwined with the GBA, experts say

Water storage capacity “seriously insufficient”

Macau is completely dependent on the water Guangdong supplies, but that was true even before there was GBA

Start-ups: Should I stay or should I go?

That all depends on the start-up’s target audience.

The road to a single currency

The doubt seems to centre on whether a GBA single-currency zone will happen before or after 2049

Big plans in transportation – Competition vs. Cooperation

Zhuhai has doubled down on its airport expansion projects, but how much coordination has there been with Macau?

Hengqin: Innovative and pioneering

Beijing has prepared a never-before-tested model to strengthen cooperation between Macau and Hengqin. This is the GBA that matters most to many observers

Covid-19: Macau better off than Hong Kong

A recently published study by three professors from the Macau University of Science and Technology (MUST) and three experts from the China Science and Technology Exchange Centre in Beijing analysed how the three main Chinese cities in the Greater Bay Area (GBA), Guangdong, Shenzhen and Zhuhai, plus Macau and Hong Kong have responded to the Covid-19 outbreak, analysing the performance and effectiveness of various medical systems in public health emergencies and clarifying the functions of medical institutions, medical staff, medical supplies, etc.

Us and them

Macau Business | February 2022 | Special Report | Migrants in Macau – The other side

When the Municipal Affairs Bureau announced plans to bar blue cardholders from using the reopened barbecue park on Hac Sa beach, a number of people struggled to see any rationale behind the move (on which the authorities eventually backtracked), particularly considering non-resident workers are among the space’s most avid users.

This situation and others prompted a debate on how far ‘positive discrimination’ in terms of protecting residents should go. Couldn’t it be interpreted as  “nationalism”, as suggested by one of the experts who contributed to this special report?

One would point out that while it’s one thing to put limits on the entry of migrants – to safeguard locals’ access to jobs, scarce resources and insufficient infrastructure and ensure social harmony and stability – it is another entirely to effectively discriminate against those who have earned the (temporary) right to reside here and who are, each of them in their own social and economic activity, important contributors to daily life in the Region.

Macau has always been a land subject to immigration, with various waves arriving and settling here over the centuries. The legalization process launched in February 1982, by the Portuguese administration at the time, was a watershed in this respect. Lasting several years, it resulted in 170,000 newly registered citizens, of which an estimated 75,000 had arrived illegally. This influx, overwhelmingly from Mainland China, caused Macau’s population in 1978 to nearly double by 1994.

After the handover and more so since the liberalization of the gaming industry, the influx of migrant workers had a significant contribution and impact on the city’s life.

The number of non-resident workers doubled in the past decade alone buoyed by the booming economy.

Today, non-resident workers continue to make up a significant share of the city’s inhabitants: as of November 2021 there were almost 171 thousand blue card holders among the SAR’s 680 thousand people. Two thirds of these non-resident workers are mainland Chinese, and about one fourth come from Southeast Asian countries.

They are a key component in this city’s social and economic development.

Co-ordinated by João Paulo Meneses

jpmeneses@macaubusiness.com

Sentiments towards migrant workers

Should non-locals enjoy the same social benefits as locals? It’s a question of boundaries

“Positive discrimination” – Striking a balance

There is a consensus across the city’s local social and political spectrum on the need to protect residents’ interests. How far should this sort of ‘positive discrimination’ in favour of locals go? Some measures proposed by the Government and lawmakers have generated controversy.

Four decades of change

In March 1982 the Portuguese authorities began a process of registering illegal immigrants that would alter the social structure of the Region far more than they would ever have imagined.

“The Macau we know today owes much of its success to migrants”

Migrants should not be discriminated against in housing, employment, healthcare or social welfare in the name of positive discrimination, says Michael O’Regan, an expert on tourism and migration.

Filipinos, Indonesians and Vietnamese: Same-same but different

Apart from those born in mainland China and in Hong Kong, these are the three largest communities of non-resident workers. Different characteristics, shared problems and aspirations.

Illegal immigrants – or labour tourists

The degree of illegal labour is considered severe by the Government and lawmakers and in public opinion

The challenges of being a ‘dual migrant’

Dual migrants are those who have migrated from a distant province to work in Macau and who migrate over the Macau border on a daily basis from a residence in neighbouring Zhuhai.

Gambling and hospitality need them

Before the pandemic, one third of Macau’s inhabitants were non-residents. Most worked in the gaming and hospitality industries. After the pandemic, the same will be true.

How the pandemic exacerbated inequalities

The pandemic did not touch everyone equally. Non-resident workers are the most penalized. And among them, the non-Chinese nationals

Will they bring home my bacon?

It’s one thing to welcome construction workers or maids, jobs Macau residents are reluctant to do; another is importing skilled manpower (and talent).

A new beginning for TCM

Macau Business | January 2022 | Special Report | Traditional Chinese Medicine – Breathing a new life

The new Law on Pharmaceutical Activity in the Scope of Traditional Chinese Medicine and Registration of Traditional Chinese Medicines (No.11/2021) goes beyond mere regulatory legislation for the sector, which has been given increasing importance by the Ho Iat Seng government.

According to those involved in the field, the language is enough to definitively catapult Traditional Chinese Medicine (TCM) into the prominent role policy makers have envisioned for it.

This special report covers that vision, what exactly has changed because of the new law, and the role of TCM in the diversification of Macau’s economy, Hengqin, in the Greater Bay Area and in Portuguese-speaking countries.

Also discussed is the (at times mistrustful) relationship between TCM and biomedicine, one thrust into the spotlight by the current pandemic.

Despite a long tradition, TCM’s awakening in Macau waited till 1999.

Going forward, TCM leads a new life.

Co-ordinated by João Paulo Meneses

jpmeneses@macaubusiness.com

A new law to combat “miracle healers”

Macau is no longer one of the few regions in Asia without a comprehensive legal framework on the registration of TCM

Diversification: TCM tops the list

More so than his predecessor, Ho Iat Seng has singled out TCM as the main element of economic diversification. The path, however, is not an easy one

A key investment scrutinized

The Traditional Chinese Medicine Science and Technology Industrial Park of Cooperation between Guangdong and Macau (the GMTCM Park), in Hengqin, is a flagship project both in terms of regional cooperation and push for diversification. However the management of the project became subject to greater scrutiny after a Commission of Audit report exposed sore spots.

Ranked No.1

Macau is home to the first ever Chinese state key laboratory in the field of Chinese medicine. The highest-rated among all Chinese medical journals is also edited and published in Macau.

A role to play in the GBA

Greater Bay Area planners believe TCM could be among Macau’s assets

An opportunity for Portuguese-speaking countries

Portugal, Mozambique and Cape Verde already have a relationship with TCM made in Macau

An industry in stable condition

Despite the Government’s show of support, interest in TCM services on the part of the population has not grown of late, and the pandemic has already left its marks on the sector.

Chinese medicine faded from Portuguese memory

The first Jesuits in Macau took an interest in Chinese medicine, but Portuguese authorities would only come around in 1999

“Dangerous” or “effective” treatment?

China insists TCM has proven effective at fighting the pandemic, but some warn of the lack of scientific evidence

The “fusion” between eastern and western medicine

Just as Macau’s unique locality sees the fusion of Eastern and Western cultures, medicine’s two modes are practised side by side, despite some suspicion

Two sides of the same coin

Macau Business | December 2021 | Special Report | Macau’s ageing society

There are two noteworthy demographic trends in Macau. 

And they are two opposite sides of the same coin: tails, an enviable life expectancy; heads, a very low birth rate. This polarity has evolved into a structural demographic problem deserving of renewed attention

One side is polished, a shining example: though there is always room for improvement, it’s fair to say government strategy on problems associated with the elderly has been successful. After all, Macau has the world’s third-highest life expectancy.

After the Islands District Medical Complex is inaugurated, once the Areia Preta complex is up and running, and when the three planned nursing homes are ready, a good situation will get even better. 

Response to the low birth rate has been very different.

On this side Macau has not done enough, acquiescent perhaps to a trend that is larger than its own borders, but one that will have a long-lasting impact on many facets of society, the city’s welfarist policies included.

In the two dozen pages that follow, readers (and the Government…) will find useful contributions from leading Macau-based scholars concerned about the demographic challenges affecting the region.

Co-ordinated by João Paulo Meneses (jpmeneses@macaubusiness.com) 

2031: The hyper-aging society scenario

In 10 years – five years ahead of schedule – Macau will be one of the oldest societies in the world.

Pensions: 123,000 beneficiaries

The Government has reinforced the Social Security Fund, which now has the capacity to pay 17 years of expenses. But a mandatory provident fund system is already being considered

Living the last days in a studio

The Areia Preta model project is seen as a key undertaking, with some 1800 studio units being built

Health with a human touch

Loneliness takes a heavy toll on senior citizens’ health 

Working after 65

Almost 12,000 elderly people in Macau work, though some may be retired, either due to the need to make ends meet or because they want to remain active

1,100 waiting

Government plans to build three new nursing homes, “meeting the demand”

Being young is not necessarily easy

The demographic challenges Macau faces are not limited to that growing elderly segment crowning a top-heavy population pyramid.

The neighbouring SAR’s demographic challenges

A significant number of people in Hong Kong wish to continue being productive after retirement, and 78 per cent said they want to travel

China: 1, 2 or 3 children

In five years, the Chinese have gone from the one-child policy to three. All to combat the low birth rate and the decline of the active population. Will that be enough?

Low birth rate “very hard to solve”

Experts assert that financial incentives are not the solution, but providing more supportive services to future mothers could change women’s mindset

The railway, the Secretary and beyond  

MB November 2021 Special Report | LRT, the unloved

Today, just about anyone in Macau would be hard pressed to say a nice word about the Light Rail Transit (LRT) project – much more after learning that Taipa line suspended all operations for 180 days for high voltage cables replacement works. 

First proposed back in 2002, the LRT project suffered constant delays over the years. 

In this special report covering its first two years of operation, we discuss the past, present and future of the LRT. 

There is also much discussion around Secretary for Transport and Public Works Raimundo do Rosário, the man who, despite burning ears continually positions himself to take bullets meant for the project. 

Ten years from now, when all the various LRT lines are up and running (those planned and others yet to be conceived), we’ll inevitably look back on Secretary Rosário’s role. 

Will hindsight a decade on have ripened today’s criticism into praise? 

Co-ordinated by João Paulo Meneses 

jpmeneses@macaubusiness.com 

The (LRT) travails of Mr Rosário

It’s not easy being Macau’s Secretary for Public Works and Transport. Managing the LRT project can be a constant headache

Next station: COVID-19

Only two months running, and the pandemic changed everything. The Taipa Line became the punch line

Peninsula? No easy feat

Building the LRT line in the Macau peninsula will entail a number of challenges

The future: Coloane and the ring?

The government has well-defined goals, but it also knows that the system, with its currently envisioned four lines, is incomplete. Sooner or later, it will eventually grow.

Seac Pai Van: Small line, big concerns

For the first time since becoming Secretary for Public Works and Transport, Raimundo do Rosário was forced to suspend a public tender to build the LRT

Hengqin: The line of the future

In the future it may be one of the most important lines, but for now, because of limitations related to Hengqin’s two borders, ambitions are held in check.

“Connecting Hengqin and Macau will definitely be essential in defining Macau as a tourism city”

Ku Weng Keong tells Macau Business “Building an efficient rapid transit has been identified as one of the most effective solutions for Macau.” However, the development and operation of the LRT in Macau “has been anything but smooth.”

Labour demands

FTU affiliated Lawmaker Ella Lei has used her voice to call for more local workers in the LRT system. Secretary Rosário answers, but the pandemic is to blame.

By Shenglu Wang and Carlos Noronha 

Faculty of Business Administration, University of Macau, China

Setting the Scene

In March 2021, China announced its latest 14^thFive-Year Plan which now emphasizes on “internal-cycle” and self-reliance. Compared to the previous 12^thand 13^thFive-Year Plans, the coverage on sustainability has been relatively reduced (8% of the total 65 chapters in the whole report) and more emphases have been placed on innovation and industrial modernization as well as economic and market reform. Furthermore, the plan has mentioned less than before about China’s pledge on cutting CO2 emissions by 2030. At the same time, China is the largest greenhouse gas emitter in the world, accounting for 27.3% of energy related CO2 emission, followed by the US and India.

The Greater Bay Area (GBA, including Guangzhou, Shenzhen, Zhuhai, Foshan, Jiangmen, Dongguan, Zhongshan, Huizhou and Zhaoqing plus the two Special Administrative Regions namely, Hong Kong and Macau (9+2)) is now destined to become China’s technology and digital hub, incorporating investments in the areas of science and technological breakthrough as well as finances (such as fintech and various high-end financial market activities). Not only to echo the policy of “internal-cycle”, the GBA also serves as a window for exporting to ASEAN and emerging countries.

Despite of the GBA’s rapid and astonishing development, carbon emission problems in nearly all cities in the area are still serious. According to a research conducted by a group of researchers in China in 2018, the cities’ carbon emission had increased rapidly from 2000 to 2011 with peak emissions in 2014 and 2016. In particular, two emitters contributed to 4% of total national emission while creating 13% of the country’s GDP. Coupled with President Xi Jinping’s speech in April 2021 that China will reach its emission peak in 2030 and achieve carbon neutrality in 2060, the long-term green policy of the country is already on a pressing agenda. Though President Xi’s announcement has been described as a tectonic shift in the country’s green policy, the situation is further intensified with diplomacy pressures from 60 other countries under the Paris Agreement made in 2015 which have vowed to reach carbon neutrality by 2030 (some by 2025) as well as China’s original pledge to reduce emissions significantly in 2030. Nevertheless, President Xi’s new pledge is now seen as an ambitious fight against global warming, by using more non-fossil fuel (to approximately 25% by 2030 according to Xinhua News (2020)). Although an obvious carbon reduction effect was brought by the COVID-19 pandemic in 2020, as the nation begins to pick up again on its industrial activities, its carbon footprints will reappear almost instantaneously. Therefore, reducing carbon emissions effectively and efficiently has become urgent in the social and economic development plan of China. 

            Guangdong Province is one of the seven pilot carbon market zones in China. The official carbon ETS (Emission Trading System) had begun at the end of 2017. Potential factors influencing carbon emission rates can be estimated by a statistical model known as the Stochastic Impacts by Regression on Population, Affluence, and Technology (STIRPAT) model. The model uses total population, urbanization level, degree of foreign trade, industrialization level, GDP per capita, foreign direct investment and energy intensity to evaluate the level of carbon emission. In particular, as Guangdong has large volumes of import and export, it is necessary to pay attention to the sustainable development of foreign trade, which reached 7.16 trillion yuan in 2018. 

The Greater Bay Area (GBA) and Guangdong Province

In Guangdong Province, the most developed cities are certainly the nine cities in the GBA. These cities are: Guangzhou, Zhuhai, Shenzhen, Zhaoqing, Dongguan, Foshan, Jiangmen, Zhongshan and Huizhou. Together they form the third largest metropolitan economic circle in mainland China.

With advanced manufacturing and modern service industry bases, the GBA has turned into one of China’s most prominent regions. Data from the National Bureau of Statistics (2019) have shown that the total GDP of the nine cities was 8.69 trillion yuan and the output proportion of the heavy industry sector increased from 12.4% in 1949 to 68.2% in 2018. 

Figures 1 and 2 show that Shenzhen, Guangzhou and Foshan in the area had a total GDP of over 1 trillion yuan in 2019. This reflects also the situation of uneven economic development in the cities as well.

Figure 1 GDP of Nine Cities in the GBA from 2010 to 2019

Source: Wind Information Financial Terminal

Figure 2 Value-Added Industrial Outputand Five-Year Compounded Growth Rate in 2018

Source: Poly Investment and Research Institution

For the purpose of carbon intensity reduction, the sustainable development of foreign trade and the effects of carbon tariffs cannot be ignored. Although the 14^thFive-Year plan has destined the GBA to develop high-end service industries and thus reducing carbon emissions, Guangdong, as a province with a large volume of foreign trade, has still a long way to go. Furthermore, the emergence of carbon labels has largely made the export of related products more difficult. Carbon labels do not only play a significant part in promoting global warming controls and cutting down on carbon emissions, they may inevitably become a new type of “green trade barrier”, namely carbon tariffs.

Factors Influencing Carbon Reduction

Carbon tariff refers to the special government tax on CO2 emissions levied by sovereign countries or regions on imports of high energy-consuming commodities, such as aluminum, steel, cement and other chemical products. 

Some developed countries have adopted Green Trade Barriers (GTB) as a means of trade protection. It is estimated that at least 7 billion USD of export commodities in China have been adversely affected by “green protectionism” each year, and there is a trend of gradual expansion. As China has been taking the role of the “world factory” during the past few decades, meeting the environmental criteria set by developed countries has become quite difficult for exports from China. Meanwhile, Guangdong is currently in high-speed economic development and a large amount of funds for infra-structure construction is required. For the sake of economic benefits and to avoid costly internalization and control of green trade, some foreign investors have transferred some pollution-intensive industries to China.

Theoretically and in relation to the Paris Agreement, the higher the degree of treaty-based climate change response to international law, the less trade friction would occur. It is more complicated when it comes to the carbon market emission reduction cooperation mechanism. Whether or not carbon border adjustment measures should be implemented to enhance the effect of regional emissions reduction remains a sensitive topic.

Foreign Direct Investment(FDI)

Guangdong Province was the first to participate in the development of globalized industries. It has attracted a large amount of foreign capital by virtue of its preferential policies and abundant labor force. The actual amount of FDI was 152.2 billion yuan in 2019, an increase of 4.9% compared to the previous year.

Figure 3 ActualAmount of FDI in Guangdong Province by Industry in 2018 (million yuan) 

Source: Guangdong Statistical Yearbook (2019)

As Figure 3 shows, the manufacturing industry was the main target of FDIs. In 2018, the actual amount of FDI in the manufacturing industry reached 520.45 million yuan, which was far ahead of other areas. It reflects the strategy of developed countries in transferring manufacturing activities, a backward sunset industry which can emit a large amount of greenhouse gases, to China. 

Import and Export

The total export volume in Guangdong Province has reached 7.16 trillion yuan in 2018, accounting for 23.5% of the total domestic amount of export, and most of them are high-carbon products. As Figure 4 shows, the export amount of Electrical and Electronics have reached 15,800 billion yuan and Labor-Intensive Products have reached 8,134.6 billion yuan. According to data from the same source, the growth rate of export industrial products was 4.7%.

Figure 4 Export Categories and Amount in 2018 (billion yuan)

S

Overall Trend

Carbon emission levels of the nine cities in the GBA from 2011 to 2019 were calculated based on the STIRPAT model mentioned earlier. A total of seven independent variables, whose data were all obtained from the statistical yearbooks of the nine cities and the statistical yearbook of Guangdong Province were used in the analysis.

Table 1 shows the calculation results of carbon emissions in the nine cities from 2011-2019.

Table 1 Calculation results of carbon emissions of nine cities 2011-2020 (103t)

Table 2 Emission factors in nine cities 2011-2019

As shown in Table 2, apart from Huizhou, Foshan and Dongguan, whose data sets are complete, the other cities have missing data concerning the respective energy elements.

The cumulative calculation results of carbon emission in the nine cities are shown in Figure 5. They indicate that the general trend is upward climbing, and there was a turning point in 2016. The growth rate slowed down in 2018, and then returned to the original level in 2019. According to “China’s Low-Carbon Economic Development Report (2017)”, energy-related carbon emissions fell further in 2016 which indicate the basic characteristics of decoupling carbon emission from economic development. However, the contribution of energy intensity to emission reductions declined in 2018, which may be due to the cyclical recovery of industrial production. As a result, the decline in energy intensity and carbon intensity cannot offset the growth of population and per capita income in 2017.

Figure 5 Calculation results of total carbon emissions trend of nine cities in Guangdong province from 2011 to 2019 (106t)

            Some highlights of the overall findings are provided as follow. 

(1) The urbanization rate, the percentage of the secondary industry, and GDP per capita are the factors that have the greatest impact on carbon emission. Specifically, the emission will increase by 12.3616% for every 1% increase in the urbanization rate; for each increase in the percentage of the secondary industry by 1 %, carbon emission will increase by 5.2065%; for every 1% increase in per capita GDP, carbon emission will increase by 3.1229%.

(2) The proportion of imports and exports has a negative impact on carbon emission. That is, for every 1% increase in exports, carbon emission will reduce by 1.6031%.

(3) The interaction term between FDI and the proportion of the secondary industry shows a negative impact on carbon emission. It shows that the greater the FDI, the increase in the proportion of the secondary industry will decrease carbon emission (see individual cities’ analyses later in the article).

(4) Studies have shown that population and energy intensity also have a positive impact on carbon emissions, but this impact is relatively small. As the overall change in population and energy structure is relatively stable, it will also accelerate the increase in carbon emissions, though its impact will be small.

Figure 6 Trend of urbanization rate in nine cities

The official classification of nine cities is as follow. Tier 1 cities: Guangzhou and Shenzhen; new Tier 1 cities: Dongguan; Tier 2 cities: Foshan, Huizhou, Zhuhai, Zhongshan; Tier 3 cities: Jiangmen, Zhaoqing.

On the whole, the urbanization rate reveals a gradual upward trend (see Figure 6). This is likely to be related to the country’s poverty alleviation strategies and the focus on rural revitalization. Shenzhen and Guangzhou (first-tier cities) have a very high urbanization rate. The urbanization rate of second- and third-tier cities is relatively low but increasing rapidly, indicating that development prospects are good.

Figure 7 Comparison of GDP per capita of nine cities and Guangdong Province and China as a whole

Figure 7 shows the comparison of GDP per capita in nine cites with GDP of Guangdong Province and China as a whole. Overall, the GDP per capita shows an increasing trend. The general economic development of each city is relatively fast. This will have a strong upward driving effect in Guangzhou, Shenzhen, Zhuhai, and Foshan, and on the national economy at large. However, it should also be noted that Huizhou as a whole is similar to the national level, and the development of Zhaoqing is lagging behind the national average.

Individual Cities

The overall influencing factors and their magnitudes of carbon emissions were obtained from the STIRPAT model. Now we select key cities for further analyses.

• Guangzhou (1^stTier)

The overall trends of GDP per capita, urbanization rate, and carbon emissions are roughly the same, but the proportion of the secondary industry is contrary to the trend of changes in carbon emissions, which shows that Guangzhou now mainly depends on the development of the tertiary industry, and the scale of the secondary industry is, relatively speaking, reducing. As the city is in the stage of rapid growth (tertiary industry), its development should theoretically not greatly promote carbon emission, but instead will reduce emission to a certain extent. However, the strong upward trend of carbon emission in Figure 8 shows the opposite.

Figure 8 The relationship between carbon emissions and related influencing factors in Guangzhou

• Shenzhen (1^stTier)

Urbanization is trending downwards because it was initially 100%, with a small fluctuation in the subsequent decline. In 2019, Shenzhen’s total industrial output value (above certain designated sizes) reached 3.69 trillion yuan, and heavy industry accounted for 37.7% of GDP. On the other hand, Shenzhen has fostered the development from scattered to complete categories, from traditional industries to advanced manufacturing. According to the data from the Statistical Bureau of Shenzhen, the proportion of tertiary industry to GDP has increased from 53.8% to 61.0%, which is dominated by the service industry which consumes less natural resources and creates mostly intangible products. The industrial structure of Shenzhen has been continuously optimized and adjusted. With this trend, the development of the tertiary industry can reduce resource consumption and contribute to economic growth at a high rate. Again, a strong upward trend of carbon emission can be observed with a slight slow-down since 2018.

Figure 9 The relationship between carbon emissions and related influencing factors in Shenzhen

• Dongguan (New 1^stTier)

Figure 10 The relationship between carbon emissions and related influencing factors in Dongguan

Dongguan is a new first-tier city with rapid development occurring during 2011-2019. As a result, various indicators are showing remarkable growth trends, which actually contribute to carbon emissions in differing degrees. It must be noted here that the percentage of secondary industries to GDP has suddenly risen around 2017 and stabilized in 2018 onwards. This explains a very unique feature of the city from the others in the GBA. Dongguan has thus been taking its role as a major secondary industry city in the GBA. Nevertheless, by comparing the carbon emission trend with the growth of secondary emission in relation to GDP, Dongguan appears to be achieving good carbon emission (simply speaking, while the yellow line had a sharp rise around 2017, the black line started to level). From the perspective of actual development, more attention should be paid to sustainability, and the government should try to avoid the old path of “Pollution first, Governance after” so as to maintain the current development trend.

• Zhuhai (2^ndTier)

Figure 11 The relationship between carbon emissions and related influencing factors in Zhuhai

In 2019, the regional GDP of Zhuhai has reached 343.589 billion yuan, a year-on-year increase of 6.8%, and the growth rate was 0.7 and 0.6 percentage points higher than that of China as a whole and Guangdong province, respectively. In terms of the secondary industry, high-tech industrial enterprises are developing well. The city’s total foreign trade imports and exports fell by 10.4% year-on-year, and the decline narrowed by 3.3 percentage points compared with the previous three quarters. Again, it can be seen that the carbon emission trend has been rising while the percentage of secondary industry to GDP has been dropping, and especially significantly since 2018.

• Foshan (2^ndTier)

Foshan has been attempting to become a first-tier city in China’s manufacturing industry by developing modern and advantageous industrial clusters vigorously. The industrial system of Foshan is relatively sound, covering almost all manufacturing industries. Traditional industries such as furniture, ceramics, mechanical equipment, and metal processing are still going strong. At the same time, new industries such as optoelectronics, biopharmaceuticals, robotics, and new energy vehicles are booming amid their present development and therefore an obvious downward sloping trend of the percentage of secondary industry to GDP can be observed. However, the carbon emission trend is obviously strongly going upwards.

Figure 12 The relationship between carbon emissions and related influencing factors in Foshan

• Jiangmen (3^rdTier)

Jiangmen is a famous manufacturing city in Guangdong Province, located in the West of the Pearl River Delta, adjacent to the South China Sea, Hong Kong and Macau. Although it is regarded as a third-tier city, its industrial development in the recent years has been astonishing. It promotes the industry towards agglomeration, scale, mid-to-high end, and creates new growth in the GBA with the support of “three strategies and three drives”. In simple, the strategy adopted for Jiangmen is to concentrate on major industrial clusters such as commercial vehicles, new energy and equipment, new materials, new education equipment and general health. The industrial technological transformation investment has increased by over 63% in 2016 over 2015. Again, although the reliance on secondary industry has dropped significantly since 2018, carbon emission has still been increasing, but with a slightly stabilizing or even reducing trend since the same year.

Figure 13 The relationship between carbon emissions and related influencing factors in Jiangmen

Final Remarks

The main conclusions of the analysis are as follow.

1. The urbanization level, the proportion of the secondary industry to GDP, and GDP per capita are the factors that have the greatest impact on carbon emissions. From a global perspective, urbanization will bring more carbon emissions due to higher carbon production by cities relative to those in rural areas. From an economic point of view, the use of urban land will tend to be more intensive and more productive with the development of urbanization. 
2. Although we have predicted that FDI will bring high carbon industries into China, the inflow of FDI can actually alleviate, to a certain extent, the pressure of CO2 emissions in the GBA. This is due to the technological spillover effect of FDI. When FDI entered, it brought both capital and innovation of new technologies. Generally speaking, the production technology and process flow of developed countries are more advanced than those at the current domestic level, and the use of foreign technology may have improved the environmental quality. However, it should again be noted that at the same time there is also a large amount of FDI flowing into pollution-intensive industries. The government should formulate a stricter environmental access system to selectively welcome foreign capital. 
3. Imports and exports may have different impacts on carbon emission. As the exports of most cities of the GBA are likely to be high-carbon emission products, economic means should be taken to internalize environmental costs. Carbon taxes and carbon emissions trading should be simultaneously adopted with carbon emission permission systems and other methods to regulate. Changing the mode of economic growth and promoting the upgrading of industrial structure is probably the most essential in reducing CO2 emissions.
4. The introduction of carbon tariffs has the greatest impact on energy-intensive industries, including electricity, cement, steel, aluminum, papermaking and printing, the main emitters of CO2. Carbon tariffs have an impact on the cost of overall economic development. Therefore, it is necessary for the competent departments of export trade to increase investment in technology development continuously, to improve production techniques and energy efficiency of products, and to reduce the proportion of energy costs. Carbon trading is newly emerging in China and it has no actual concrete businesses and lacks a commercial profit model. Due to the constraints of the total amount of carbon trading relative to domestic carbon emissions, the said trading in China is mostly voluntary and as such lacks incentives to reduce emissions. Furthermore, there are not enough emission quotas for enterprises, making it impossible to issue broad emission quotas to various organizations. 
5. The GBA must follow the development trend of global low-carbon initiatives and carbon pricing mechanisms, and build its own competitiveness by taking advantage of opportunities in the developing carbon market domestically and abroad. The global low-carbon trend will trigger changes in economic, trade, and technological competition patterns. High-carbon industries and technologies are facing financing difficulties. At the same time, the green and low-carbon orientation of the national fiscal, taxation and financial policies provides development opportunities for low-carbon transformation of enterprises. Under the impetus of the carbon market, enterprises must consciously promote transformation and upgrades. 

As can be seen from our analyses, all the observed cities have shown a downward trend in terms of secondary industry to GDP (especially with emerging Jiangmen drastically transforming its industrial structure since 2018. However, Dongguan is still taking its role as a major secondary industry city) but the trend of carbon emission is still increasing during the period under study. This reflects the country’s strategy to revamp the cities in the GBA to become the high-end secondary industry (such as high technology manufacturing, artificial intelligence, and so on) and the tertiary industry (services, finance, e-commerce, etc.) headquarters. However, the control or internalization of carbon emission through tariffs or carbon exchange markets is still under major development. Echoing what was mentioned previously, the GBA can be an exemplar in carbon emission control through going high-end and attracting selective FDI suitable for the overall strategy. It can be foreseen that this radiating effect to finally reach carbon neutralization for the country can be achieved hopefully much earlier than 2060.

The development of China’s carbon emission trading market has started relatively late compared to European countries, and China is currently facing many challenges in reducing its emission level. The pilot projects for carbon emission trading were officially launched in November 2011, and the actual statistics regarding carbon emissions at the city level in Guangdong Province were not available until 2017 Therefore, some types of fossil energy data are still missing from statistical bureaus.

Further attention should be paid to the transition from traditional energy to clean energy, which is renewable. Their common characteristics include low energy density, dispersion, intermittentness, and randomness. As a result, the development and utilization of new energy will suffer from certain restrictions and technical difficulties. However, clean energy has the distinct advantage of not polluting the environment. The production and consumption of fossil fuels is causing rapid changes in the global climate, and the resultant environmental issues will have a significant impact on the supply of energy. Finally, vigorously developing and utilizing new and renewable energy will be a positive choice for the future energy policies in the GBA.

• References may be provided from the authors upon requests.

The need to walk the talk

MB September 2021 Special Report | Green Macau

The special report that follows on the next 20 pages is not just about renewable energy, but in that particular respect Macau needs to stop wasting time: in terms of energy supply, we are basically no different today as we were 20 or 30 years ago, importing nearly 100%.

The terms climate change, reduction of emissions and waste, sustainability and energy transition goals, have all become part of our daily language.

But when it comes to walking the talk, Macau seems to be headed in the opposite direction from many places around the world, including Mainland China, which has taken decisive steps in the right direction.

If it’s certainly not for lack of financial resources, could it be the absence of the right conditions?

As the reader will discover, plenty of specialists believe Macau has excellent conditions for solar energy, as well as for offshore wind farms in the Region’s own 85 km² of territorial waters.

Along with talk of green energy comes pollution (particularly the unwieldy problem of solid waste), recycling, the impact of tourism and our relationship with the region around us (the Greater Bay Area). We end with another warning that can’t be repeated too often: be worried about a rise in sea level; Macau is very exposed.

P.S.: The impact of sea-level-rise on Macau is in fact one of the issues driving Portuguese concept artist and illustrator Ricardo Lima, who exhibited his sci-fi work MO2049 last year at the Taipa Village Cultural Association. This special report is illustrated with images by Ricardo Lima, to whom we are grateful for the collaboration.

Coordinated by João Paulo Meneses (jpmeneses@macaubusiness.com)

Only 5 photovoltaic interconnections

Almost all the energy consumed in Macau comes from Mainland China. There is a long way to go in terms of renewable energy despite the existing potential

To charge and raise awareness

Implementation of the “polluter pays” principle is proceeding slowly. The government is focused more on awareness-raising and incentive initiatives, such as the Macau Green Hotel Awards.

Tackling the solid waste malady

Mass tourism translates into too much garbage. It has been a serious problem and prompt action is need. The Government is aiming at a 30 per cent reduction in solid waste.

Hazy problem

Air pollution is one of Macau’s most serious environmental problems. But no matter how Macau improves its habits, the Zhuhai Jinwan Power Plant remains right next door…

Environmental awareness: before and after Hato

Macau residents’ environmental awareness has improved significantly in recent years, but more is needed

Tá Pau* recycled

Reducing food waste is a Government priority, but 72 per cent of local restaurants still treat food waste as regular domestic waste.

“It is very unlikely that Macau can be a sustainable, energy-efficient city in the short and medium term.”

Environmental science expert Wai Ming To is sceptical on solar or wind energy being developed in Macau. He argues instead that the city can do slightly better is to adopt smart/intelligent building systems that optimize the use of electricity for air-conditioning, and air and water heating

Eco-friendly hotel

Most hoteliers actively introduce initiatives that contribute to cost savings, but more investments are needed

GBA and the case for legal synchronization

Experts call for the “creation of a mechanism of legal cooperation in environmental governance” and  “collaborative environmental governance” in the Greater Bay Area

Sea level in Macau “is now rising at an accelerated rate”

Scientists’ prediction for a medium-emission scenario is that by 2060 water levels will have risen 34 cm in Macau, about 20 per cent higher than the global average

“The most dramatically changing place on the planet”

MB August 2021 Special Report | Casino tourism: the pros and cons

Nothing in the last 20 years has had such overwhelming effects on Macau as the liberalization of gambling.

While the city and its inhabitants changed with the Handover, they arguably changed even more with the decision taken in 2001 to end STDM’s monopoly.

“The casino boom has had a far-reaching impact on the territory’s landscape, social fabric, economic life and everyday culture, transforming it from a colonial outpost into what Las Vegas casino entrepreneur Steve Wynn breathlessly called ‘the most dramatically changing place on the planet’.”

Macau has changed for the better in many ways, but the city has also felt side effects – and that’s what this special report is all about.

In order to assess the costs and benefits of the transformation begun in 2001, we’ve chosen to let the people of Macau speak for themselves – not to us directly, but through the numerous opinion studies that have been carried out in the context of scientific research.

Since the middle of the last decade, researchers from Macau and abroad have been producing a great deal of material on this subject, a body of work representing knowledge capital that must not be wasted. The above quote – which served as a guiding theme for this special report – comes from one of those researchers: Shih-Diing Liu, a professor at the University of Macau.

With some exceptions, the reader will note that we have favoured academic research undertaken within the last 10 years, which it seems to us reflects a reality closer to the one we lived in until the COVID-19 pandemic arrived.

Co-ordinated by João Paulo Meneses

jpmeneses@macaubusiness.com

Between “paradox” and “dilemma”

Residents of Macau exhibit mixed attitudes towards the gambling industry. According to a team of researchers, “The development of casino gambling definitely triggers intricate emotions in the minds of local residents.” …

Quality of life: impact slightly positive

Ultimately, the value obtained for overall satisfaction with quality of life indicated that residents were not substantially satisfied with their life in general, surveys show

Pro: The paradise of full employment

In the last 20 years job supply has exceeded demand; unemployment exists, but only technically; casinos have greatly buoyed the average wage. Will it be like this forever?

Pro: More wealth

Income generated by development of tourism, essential for maintaining the livelihoods of local people, comes mostly from the large tax on revenue paid by gambling concessionaires.

Other positives

More entertainment and recreation facilities, more transport infrastructure and even increased pride as a member of the community. These are some of the other advantages listed by residents.

Con: Cost of living

People earn more, but not enough to buy a house. Salaries have gone up, but in many cases the rising cost of living has outpaced them.

Con: More crime and corruption

Of the five studies based on surveys of the Macau population that we cite in this special report, three mention an increase in crime as one of gaming liberalization’s negative consequences

A harsh portrayal, seen from the Mainland

Few studies on Macau originating in the Mainland are as critical as one that argues, among other observations, “There is a risk that control over urban development will end up in the hands of outsiders who care less about local interests”

“A distinct post-colonial and postmodernist identity”

In survey studies, when residents are asked about the benefits and costs of gaming liberalization, one of the complaints has been the erosion of local identity.

Well placed among GBA cities

A study compared the 11 cities in the Greater Bay Area, with Macau presenting well or very well on several indicators, from public libraries per capita to the proportion of social security expenditure. The problem is the average price of commercial housing.

Why a patient hospital?

MB July 2021 Special Report | A patient hospital

“In 2009 the Government started planning construction of the Islands District Medical Complex, they decided on the location in 2010, and they commenced works in 2011, with completion scheduled for 2014 – a date postponed to 2019 for the first phase and to 2020 for the second. The Government later stated construction would not be completed in 2019 and that it was not possible to establish a completion date, or the costs.”  – Zheng Anting, legislator, 2019

Patient: enduring, uncomplaining, acquiescent.

These words come to mind when considering the planned Islands District Medical Complex – intent announced in 2009, formalized 25 February 2010 and expected to be ready ten years later.

In the end, Chui Sai On would not get the chance to preside over the hospital’s pre-inauguration at the end of his term.

His successor, Chief Executive Ho Iat Seng, may not want to commit himself, but a part of it (namely the main building) is likely to be operational by 2024, towards the end of his first term.

In this special report we take stock of the situation and gather explanations for the great many delays.

Looking ahead, this report addresses other issues – such as Mainland China-based health care provision for Macau SAR residents – to understand what smart health care is and to discuss the healthcare industry’s potential, as put forth by the Government, as a driver for economic diversification.

Co-ordinated by João Paulo Meneses

jpmeneses@macaubusiness.com

Deadlines and costs

The Government has not offered much information in the past on the Islands District Medical Complex, prompting complaints from the Legislative Assembly Follow-up Committee on Public Works

Endemic delays

Unpreparedness, successive revisions to projects and coordination issues between two Bureaus all contributed to successive delays in the work, critics say

The 0.07 per cent industry

In Macau there is already talk of a health industry based on traditional Chinese Medicine, but the fact of the matter is it’s only worth 0.07 per cent of the total GVA (gross value added) for all economic activities.

2020, an abnormal year

Not counting consultations and emergency attendances, the occupancy rate of inpatient beds fell by 12 per cent, and the number of surgical operations performed decreased by almost 7 per cent. In return, cases of salmonella infection leapt almost 300 per cent.

The ever-growing health budget 

The health budget was MOP1.1 billion in 2001; now it’s MOP12 billion and could double in 2024 with the new hospital in operation

Hengqin: two new hospitals

All at once, three new hospitals will commence operation, one in Macau and two – one public and one private – in Hengqin.

Smart healthcare

China is highly advanced when it comes to the use of information technologies in healthcare. Macau only needs to emulate the best practices across the border.

Seac Pai Van Health Centre awaited

Residents began moving to the Seac Pai Van neighbourhood in 2013. If all goes well, the new Health Centre will be fully ready in 2022.

TCM and COVID-19: in need of further research

Opinions are divided: there are those who defend the use of Traditional Chinese medicine (TCM) to prevent and cure COVID-19 and those who warn of associated dangers.

Beyond the pandemic

Possibly because the Government does not want to let the ins and outs of the public tender for casino concessions intermingle with the September elections, the consultation on the proposal to review the gaming law is set to be launched in October, with a new Legislative Assembly already elected and at work.

MB June 2021 Special Report | Gaming: The road to June 26, 2022

Is there time to have everything ready by June 26, 2022, the expiry date for the current concessions?

It’s possible – in theory – but the overwhelming majority of our sources wouldn’t bet on it.

Incidentally, the Macau Gaming Inspection and Coordination Bureau explained to us that revision of law 16/2001 “is expected to be concluded in the fourth quarter of 2021 (depending on the situation of the public consultation).”

Doubts also exist over the true impact of the pandemic – more than enough reason for the Government to postpone the promised tender.

In other words, it seems highly likely the Government will proceed with an exceptional move: extending the current concessions (and subconcessions) by a number (1 to 5) of years in accordance with the law, and meanwhile calmly preparing the public tender.

In this context, one needs to factor in a number of developments: the new legislation, additional strings attached to the future concession contracts (such as a stronger focus on corporate social responsibility), the potential adoption of the digital yuan and the political and geopolitical dimension of the city’s gaming industry.

Co-ordinated by João Paulo Meneses

jpmeneses@macaubusiness.com

All that’s left is the announcement…

…that the public tender is postponed and the six operators will see an extension of their concessions.

The paradise of paradox

Ongoing investments show that the concessionaires are not afraid of the public tender.  

All waiting on the new law

There will be a new law. To regulate the new public tender. Some changes are already known, but there will certainly be many more. 

The imbroglio that will delay reversion

It’s not known when re-tendering will take place, but sooner or later gambling concessions and sub-concessions will be called up. And when that happens there will be some problems on the table…

Ok with CSR, but how?

Even before details of the next tender are known, it’s understood Corporate Social Responsibility will play a bolder role. It remains to be seen how.

Diversification? Pay attention

The mind behind the 2001 tender warns against the idea of asking future concessionaires to commit to works and investments beyond their core business: gambling and tourism.

Waiting for the digital yuan

Since the RMB became legal tender in Macau the path was opened to use of the digital RMB as well. As the headline of a Bloomberg article states: “China’s Digital Currency Could Reshape Macau’s Gambling Industry.”

Online gaming, now… or later

Some observers believe the question is not whether Macau will have online gaming but when, despite Chinese “opposition”.

China’s influence “will be huge”

Are US-based concessionaires right to be concerned about the ‘cold war’ climate between the U.S. and China, or has the situation improved since Trump left office?

COVID-19, an exceptional circumstance

Even if there is enough time to realise the new public tender, few believe that, with all the effects of the pandemic still to be assessed, the Government wants to do so in this context.

Forward looking

What better way to celebrate Macau Business’s 17th anniversary than to showcase 17 locals aged 35 and younger with the kind of talent that boosts our confidence in the future?

MB May 2021 Special Report | 17 talented young people

Letting this eye on the future inform our view of the next 17 years (at least), and knowing Macau is home to young people with these qualities – so determined and capable – the future we foresee can only be positive.

We limited our selection to 17, but you should know there could have been a lot more. Macau boasts a small army of talented young people, and choosing was no easy task.

On the other hand, we curated our sample to be as representative as possible, to include young people from all walks of life involved in the widest array of community sectors.

We salute them and our city’s future.

Co-ordinated by João Paulo Meneses jpmeneses@macaubusiness.com

Annie Lao

Studying in Australia let Annie Lao discover nature. Typhoon Hato made her realize how necessary it is to protect the land we live in.

Arnaldo Ho

One of the youngest on our list, Arnaldo Ho already boasts a number of accomplishments. Possibly due to his family background – as the son of Stanley Ho and Angela Leong – he has set out to conquer his own space.

Calvin Chui

At 29, he was made partner in one of Macau’s main law firms. At the same time, he has been proactively involved in a number of local associations, following in a family tradition of community engagement.

Danny Chi-Man Leong

Self-styled the “Macaoantman” on Facebook, Danny is more than that. He is an insect expert and an ecologist concerned with Macau’s environmental future.

Eric Fok

Macau is already too small to contain the talent of this ancient map designer, but he’d be the first to tell you: no place but Macau could have inspired his work.

Gary Chao

There is no one else in Macau who can boast having ascended to the Chief Executive’s top advisory body at the age of 31. No wonder he’s seen as a future leader of Macau.

Ieong Meng U

He has been playing a proactive role in the new wave of studies on Macau politics.

Inky Leong

He is among the first of Macau’s residents invited to attend a number of renowned international Fashion Weeks. But Inky Leong’s interests go further.

José Álvares

José Álvares was made partner at just 29 and has been a prominent lawyer among the younger generation. He has also become a current affairs commentator and has been sharing views on Macau and Hong Kong, while refusing to jump on the China-bashing bandwagon.

José Chan Rodrigues

In 2010 he participated in a TDM program, and that experience changed his life. Today José Rodrigues Chan is the most requested emcee for local major events. And he already has his eyes set on the Mainland.

Ka-Meng Lei

He is one of the most brilliant local under-35s in science. Ka-Meng Lei was at Harvard, but he believes it’s possible to conduct top-level research in Macau.

Kenny Lei

Deeply involved with the local start-up community since 2017, he is one of the co-founders of the Macao Startup Club.

Lao Chi Long

He founded his first company at the age of 25 and hasn’t stopped since. Yet he wants to be known not just as a businessman, but as an entrepreneur, something he’s been doing for the past eight years.

Stephanie Chiang

Stephanie Chiang is involved in several projects, many of them as a volunteer. Combining women and technology is her greatest challenge.

Sulu Sou

The city’s youngest ever elected lawmaker, at 29 Sulu Sou is the SAR’s most outspoken opposition politician and advocate for universal suffrage. He was first noticed when he was just 18.

Tracy Choi

Tracy Choi is already a prominent, award-winning local filmmaker, in spite of difficulties making her own films on the themes that interest her most: gender and feminist issues.

Venus Loi

These young people are good at multitasking – never focused on just one goal. Venus Loi is, among many other things, one of the faces of the organization Startup Weekend Macao and Macau’s first TEDx event, TEDxSenadoSquare.

Ones to watch

Fortunately, there are far more than 17 young people aged 35 or under who stand out in Macau. The following list is proof, if ever you needed it.

China wants; Macau waits

Back in 2016, Premier Li Keqiang declared: “China will support Macau to become a financial services platform”.

MB April 2021 Special Report | Financial Hub in the making

It has been over four years, and in practice nothing too substantial has come to fruition.

But Beijing has not forgotten the need to develop Macau’s financial services.

The Outline Development Plan for the Guangdong–Hong Kong–Macau Greater Bay Area, published in 2019 by the State Council, stated the need to study the feasibility of establishing in Macau a yuan-denominated securities market and to explore the development of a Macau–Zhuhai cross-border financial cooperation demonstration zone.

And last year, according to official Mainland media, the National Development and Reform Commission said that Beijing is considering setting up a Macau securities exchange market in Hengqin to help develop a financial system in the SAR with “special features”.

Details are yet to be unveiled, but it seems certain that something substantial will happen in the local financial sector, the most promising industry with respect to accomplishing a real degree of economic diversification.

This is what this special report anticipates, remembering that it was exactly two years ago that the then Secretary for Economy and Finance announced: “the Government is currently preparing the choice of an international consulting firm to carry out a preliminary study on the feasibility of establishing a stock exchange in Macau”. Nothing has transpired to date.

All we are able to find out is that the preliminary results point to a bet on bond trading, something that is definitely on the Government’s agenda.

In this special report we offer a collection of information and perspectives to help readers understand what is taking shape and what lies ahead.

Coordinated by João Paulo Meneses

jpmeneses@macaubusiness.com

“It should be in Macau”… Or not

The Central Government is studying the possibility of establishing a Macau securities exchange market in neighbouring Hengqin. However local authorities are taking a cautious approach to it at this stage.

Bond, the future is bond

The government’s bet was to create a bond market in Macau. Is the idea compatible with a stock exchange (NASDAQ style) in Hengqin, or not? For now, pursuant to the preliminary results of research, conducted by the appointed international consulting firm, “it has been basically concluded to develop securities business with bonds as its priority.”

Macau, a new Hong Kong?

Could Macau be an alternative to Hong Kong as a financial hub? It may seem a far-fetched suggestion, but analysts float the idea of a division of labour between the two SARs in the future.

Learning FinTech beyond Hong Kong

The technological sector associated with finance needs to advance further in Macau, but it should not be dependent on what happens in the neighbouring Special Administrative Region.

Wealth management

Of the entire financial area, wealth management seems to be the most advanced in the Greater Bay Area logic. Macau will benefit, but some warn of money laundering risks

The protracted revision of the Financial System Act

Macau will never be a real financial market without a legal system in line with the city’s needs, a long-protracted move which has been sluggish to take shape

Importing and training talent

Even without the promised changes in the financial system, Macau already has a shortage of skilled labour. To provide more and better services the city badly needs more talents. The question is: how to attract them.

The Lusophone connection

China is committed to it, but are Portuguese-speaking countries able to take advantage of what Macau has to offer as a financial services hub?

Financial market: two portraits

There are those who view it with optimism and those who point out flaws. Everyone agrees that it can grow.

Casinos: Simply too big to ignore

What will the role of the gaming industry be in building the new financial system?

Rising to the Challenge 

Forty years ago, on March 28, 1981, the era of modern tertiary education was inaugurated in Macau with the opening of the then privately owned University of East Asia, the predecessor of the city’s publicly owned University of Macau.   

MB March 2021 Special Report | 40 years of (modern) tertiary education

Over the course of these four decades, higher education witnessed a staggering growth and transformation in line with the city’s development. 

Since 2000, and even earlier during the Portuguese administration, public and private higher education institutions have been receiving generous support from the Government. 

At this juncture, one can argue that higher education in Macau is at a turning point. The changes that are set to take place are not only the result of the recently released Long-Term Plan for Tertiary Education (2021-2030), but also of the Chief Executive’s approach to higher education financing and development. 

A new paradigm may emerge now with a stronger focus on ties between universities and the business sector, forging a model not only less reliant on public funding but also capable of further involving higher education institutions in the wider push for economic diversification, trough spinoffs resulting from transfer of technology. 

Against the backdrop of higher stakes, we review the development of the city’s higher education sector and delve into the future direction of tertiary education, taking into account the Greater Bay Area regional integration process. 

P.S.: Some local government departments have a tendency not to be particularly responsive when it comes to questions sent by journalists. In this context, one should acknowledge and highlight the valuable and effective feedback and collaboration provided by the Higher Education Bureau (which has meanwhile been integrated into the Education and Youth Development Bureau).

Co-ordinated by João Paulo Meneses

jpmeneses@macaubusiness.com

UM Rector: “We aim to be among the world’s top 200 universities in five to ten years”

The Rector of the University of Macau (UM), Yonghua Song, is keen on taking the institution to new heights. As UM celebrates its 40th anniversary, the goal is to climb into the ranks of the world’s best 200 universities this decade through an improved focus on research, teaching and internationalization. 

Research reaching out

University of Macau (UM) Vice Rector for Research Wei Ge aims to boost the impact of the research and development carried out by the university and foster academia-industry collaboration. The “One Country, Two Systems” principle is the key advantage.

Before and after March 1981

Forty years ago, the University of East Asia (later renamed University of Macau) inaugurated Macau’s modern tertiary education filling a long lasting gap, four centuries after the city was home to the first Western university in East Asia.  

Size and (student) population

In terms of campus size and comprehensiveness of the programmes offered the University of Macau clearly stands out. But the Macau University of Science and Technology (MUST) is home to more students than UM.

Adding value

The Government is keen on turning higher education into an industry that can contribute to the diversification of the local economy. 

Other ideas

Although the number of students who finish secondary school is decreasing, the government wants to significantly increase students enrolled in higher education by 2025. Or precisely because of that.

International rankings: a balancing act

UM and MUST are on a league of their own compared with other local universities when it comes to international rankings. The two institutions have climbed up the rankings thanks to a stronger focus on research output. But some question whether it comes at the expense of teaching.

On academic freedom 

The Government and university representatives guarantee that academic freedom is sound in Macau, while some critics cast a more sceptical eye on it. 

‘More boredom’, ‘more gaming’

Tertiary students have free time, money, increased freedom, accessibility and interest to play different gambling games, a study shows.

Cross-border mobility 

It is a two-way street. Student mobility across the border is increasing alongside the prospects for collaboration between higher education institutions, namely in the Guangdong-Hong Kong-Macau Greater Bay Area.  

Is Hong Kong no longer a model?

Universities in Hong Kong maintain their trademark as reference in East Asia, but the neighbouring city’s model is not without its flaws.

“Higher education in Macau has developed fast with very good government funding”

Macau-born Iu Vai Pan was Rector of the University of Macau for 9 years (1999-2008) and currently serves as College Master of Stanley Ho East Asia College (SHEAC) at UM, where he continues to teach at the Faculty of Science and Technology. Professor Iu first joined UM (then as University of East Asia) in 1988, making him the most veteran university lecturer still in office.   

Ou Mun, Macao, Ao Men and Macau *

“Edificio Pik Tou Garden” is a (very pleasant, says who knows) apartment building in Macau. 

MB February 2021 Special Report | One city, four ‘languages’

But beyond that, the name of the building is a remarkable metaphor for the local language environment: Edificio is the Portuguese word for building, Pik Tou means jade wave in Cantonese, Garden,… you know. 

“Three different ‘languages’ in four words is quite striking and one of the things which makes Macau unique,” states a leading expert on local language ecology, John Wheeler.

Local Cantonese-speaking people describe that as the saam man sei jyu (三文四語), referring to written Chinese, Portuguese and English and spoken Cantonese, Putonghua, Portuguese and English. 

The government itself has adopted a policy of promoting “three written languages, four spoken languages” (três línguas, quarto idiomas, in Portuguese).

Over the next 20 pages, we will explore the role of each of one of the four, and take note of the views of locals who master all four languages (quadrilinguals), an ability that will be increasingly common in the next 20 years in Macau, and one that brings a key competitive advantage, as Macau’s is to be further integrated in the Greater Bay Area, by playing the role of a hub for linkages between China and the Lusophone world.

As put by John Wheeler, “It seems likely that the four main languages present in Macau will continue to blend for the immediate future, assisting in giving Macau (SAR) its unique linguistic flavour.”

* The order of the four words has to do with the interest that each of the four languages arouses in the population of Macau, according to some studies. But for us and for many others, Macau is the (romanization for the) name of this land.

Co-ordinated by João Paulo Meneses

jpmeneses@macaubusiness.com

Cantonese in peril?

The influx of mainland tourists brought Pǔtōnghuà and simplified characters. Cantonese is still widely spoken, but observers anticipate that it’s set to lose ground as 2049 edges closer.

The May 2012 controversy

A McDonald’s signboard written in simplified characters started an unprecedented discussion in Macau.

澳门 or 澳門?

A few months from now, when the results of the 2021 Census are publicly known, there will be certainty, but just now, the reader can bet on an increase in the number of Pǔtōnghuà speakers in Macau.

EOZGY, the Pǔtōnghuà’ school

The first public school to offer all levels of education in Macau and the only one in Macau adopting  Pǔtōnghuà as medium of instruction

The status of Portuguese as an official language  

Portuguese has witnessed a renewed interest in recent years thanks to China’s focus on highlighting Macau as a Sino-Lusophone hub. However the meaning and practice of being an official language end up being rather nuanced.

Judiciary: what remains of bilingualism

A doctoral thesis carried out in Macau in 2016, among the Portuguese community based here, showed what has always been known: “there is no interest from the Portuguese community in learning [Chinese] in a general way,” says Vanessa Amaro, the author.

English, a “de facto working language”

Unofficial language of Macau? Lingua franca? English is everywhere, except in justice.

Macau or Macao?

For some it may be a detail, for others a merely symbolic issue and for others much more than all of that – a matter of identity

Being quadrilingual

They are cases in point in the city’s push for multulingual talents. Four local residents, proficient speakers of four key languages: Cantonese, Mandarin, Portuguese and English  

“It’s the economy…”

The COVID-19 pandemic changed the world. We just don’t know how much yet.

MB January 2021 Special Report | The COVID-19 year

The Macau SAR coped with this unprecedented public health crisis with remarkable success. 

However, the city’s economy is expected to have shrunk by at least half.

In Macau, too, there will be nothing like before, even if tourists start filling the streets and casinos from the second quarter of 2021 onwards.

The next generations will not forgive us if we have not learned the lesson and if we do not take advantage of the collective scare to change the economic model, which – based on the only existing industry – paralyzed the Region during 2020 and generated the greatest economic crisis in memory – we had to go back to the end of the 19th century to find similarities.

Even so, there is a substantial difference: Macau is today a very rich city, with large budget surpluses, which have made it possible to compensate for many of the economic and social problems.

In 1992 one of Bill Clinton’s leading campaign strategists invented the phrase “It’s the economy, stupid”.

Stupid is what we all will be if we don’t learn from mistakes and adjust the current economic model.

Over the next few pages, readers will find the most complete coverage of what happened this year, looking at the past, present and future.

Co-ordinated by João Paulo Meneses

jpmeneses@macaubusiness.com

Two weeks in February  

In 2017, super-typhoon Hato swept though the city in a way that it prompted a debate about whether the casinos should have closed or not. Now the pandemic led to an unprecedented two-week blanket closure. It’s all new and all different with Covid-19. Also, it’s new for casinos and their gamblers.         

The “dramatic collapse” of visitation

Are days of mass tourism behind us? Visitation remains a far cry from the pre-COVID 19 period. Experts point to a new normal for the city’s core business.

The main measures

There is a great deal of unanimity around the way the Macau Government has managed this first year of the pandemic.

Praise…

Throughout this year, Macau received several praises from others, and several scientific articles cite MSAR as a reference. We added several of these compliments along with the few criticisms that were heard.

Not so well-oiled Bay Area

The Greater Bay Area’s co-management of the pandemic brought to the surface coordination shortcomings. Politics of disjuncture were noticeable between the two SARs.

Mental health impact could be “pervasive and prolonged”

When the pandemic passes and everything goes back to ‘normal’, mental damage will remain, experts warn.

The deepest contraction

Many felt in the past that Macau had an excess of financial reserves and that it was destined to keep on piling up budget surpluses, without other objectives. In the end, the rainy-day fund came to the rescue in 2020. How will 2021 be?

Very popular

Surveys show stronger adherence to some COVID-19 precautionary measures like face mask wearing (96.4 per cent) but not others, such as social distancing (42.3 per cent).

From bubonic plague … 

What can we compare with the crisis caused by COVID-19 in 2020? It will be said that no two crises are the same, but in the last 150 years, we have found two moments in which Macau truly trembled.

In search of a new model

The economic model we all know in Macau no longer serves; the Chief Executive is the first to admit it. New ideas are needed. Some experts leave their contribution on these pages.

How will it be afterwards?

In the New Year’s message, less than a year ago, the Chief Executive said that in 2020, Macau would experience “great development opportunities and face all kinds of challenges”.

MB December 2020 Special Report | Ho Iat Seng – Year 1

But on the same day, China’s office at the World Health Organization announced the discovery of cases of pneumonia of unknown origin in the city of Wuhan and 24 hours later the Government of Macau began to check the temperature of those arriving at the region’s airport from that Chinese city.

It was the beginning of an unprecedented crisis. One that assumed such proportions that the Ho Iat Seng Government has had little chance of demonstrating its capacity to govern beyond being a de facto permanent crisis cabinet.

And, almost everyone says, successfully, at least that’s what can be seen from the opinion polls and widespread praise coming even from voices know for being critical of the establishment.

But what will happen once the health crisis is effectively behind us and the city still needs to cope with the economic crisis that resulted from the pandemic?

In this special report we review Ho Iat Seng’s first year in office, exploring diverse angles and taking note of three different points of view:

Meng U Ieong is a Macau-born Assistant Professor at the University of Macau’s Department of Government and Public Administration, is know for is independent-minded approach.

Sonny Lo Shiu Hing is probably the most accredited Hong Kong-based political scientist when it comes to Macau affairs. His views are carefully read by critics and supporters of the establishment.

José Álvares is a Portuguese lawyer based in Macau from the younger generation who has recently stood out as a current affairs commentator.

Our most sincere thanks for their contributions.

Co-ordinated by João Paulo Meneses jpmeneses@macaubusiness.com

Not even Edmund Ho was so popular

The population is very satisfied with the work carried out by the Executive in combating the new coronavirus. And praise even comes from well-known political opponents. 

Hong Kong: Unwanted problem

The political and social situation in Hong Kong influenced Ho Iat Seng’s first year in office.   

Break with predecessor

Perhaps a more definitive assessment of Ho Iat Seng’s leadership style can only be drawn in the post-pandemic situation, but what we have witnessed so far comes to a great extent in contrast with his predecessor. 

Master plan: The major first policy test

Nine months after taking office, Ho Iat Seng rolled out a major asset: the draft of the city’s first comprehensive urban master plan. The blueprint generated mixed views and is seen as a major test for the future development of Macau. 

Economic diversification? Hengqin!

“We want and hope that Hengqin will become a second Macau”, underlines Ho Iat Seng, while stressing that economic diversification must be developed in the short term. 

Public administration reform facing delays

Ho Iat Seng wants to reform the public administration, and he has plenty of reasons to do so. One is to allow a more efficient management of resources.  

‘The poster boy’

Why change a successful formula? Macau is hailed as the best example of the ‘One Country, Two Systems’ concept.  

Housing to the forefront 

As the fight against the COVID-19 pandemic takes centre stage, other matters which took the back seat are likely to come to the limelight.  

Future challenges around the corner 

While the priority is to recover the economy, will 2021 be a year of social challenge? Recent words from the Chief Executive himself seem to anticipate this scenario. 

New and better accesses needed

The Macau International Airport is saturated and only now are solutions being found, which essentially depend on the new land reclamations, which are yet to get the final green light by Mainland authorities. 

MB November 2020 Special Report | Getting in and out

The high-speed train does not enter Macau because there seems to be no space to build a station.

If there is an area in which Macau depends on third parties (read, mainland China), it is in accessibility.

Look at what happens with the Hong Kong-Zhuhai-Macau Bridge. 

Therefore, the creation of the Guangdong Hong Kong Macau Great Bay Area (GBA) in 9 + 2 cities in Guangdong province seems to be the solution to many of Macau’s mobility problems – to top it off. This is the case as mobility plays a pivotal role in the GBA development plan.

There are forecasts (made long before the Covid-19 pandemic) that point to 40 million tourists in 2025, roughly the same as last year’s 39 million mark. 

Though we are in unchartered waters due to the coronavirus crisis, if Macau is to bounce back to the pre-pandemic figures, it is also essential to reflect on how they are going to get in and out – this is what we do in this special report, much more because China’s master plan is to transform Macau into a World Centre of Tourism and Leisure.

New and better accesses are needed.

PS – Air Macau marks 25 years this month. We have not forgotten that. It was a challenging quarter of a century amid criticism, but the city’s flagship carrier has weathered the storms. A different question is whether these 25 years of monopoly as the sole operator of services to and from Macau have served Macau’s development and strategic objectives well. An increasing number of voices make the case for the need to break the monopoly.

Co-ordinated by João Paulo Meneses jpmeneses@macaubusiness.com

Air Macau’s achievements 

Despite the difficulties, mainly related to the small domestic market (and the overwhelming competition from Hong Kong), Air Macau managed to make its own path in these 25 years 

“I am optimistic about the transportation development” 

Professor Tammy Ku (Ku Kei Ieng) has a Master of Business Administration in Aviation Management and she obtained various certificates from International Air Transport Association (IATA) and Airbus related to airport and airlines operations and HKCAD Aviation Academy. Lecturer at Macau Institute for Tourism Studies, Doctoral of Hospitality and Tourism Management, she is one of the leading experts in the contribution that aviation can make to tourism in Macau. 

HZMB: the future is now

For many, the bridge connecting Macau and Zhuhai to Hong Kong is a disappointment, but for the experts heard by Macau Business, the benefits are obvious.

Will the bridge kill the ferry?

There will always be those who choose to come by boat, especially if it is more convenient. But the numbers for 2019 show a sharp drop in passengers who opted for ferries.

The new ‘Airport in the City’

With MIA having already reached passenger capacity, the airport is now working on different fronts to expand it. 

Too dependent on HKIA? 

Did the Covid outbreak show that Macau is too dependent on Hong Kong International Airport (HKIA), or is there really nothing else to do but take advantage of one of the largest airports in the world which is conveniently located only 40 minutes away?

GBA looking for Macau

China wants to improve interconnectivity at the Guangdong-Hong Kong-Macau Greater bay Area (GBA). One of the biggest beneficiaries will be Macau, which still needs better access.

The mystery train

Mysterious for several reasons: because the reason why there is still no train in Macau or why we started thinking about it so late is unclear.

The future is WCTL, but also GBA

China wants Macau to be the World Center of Tourism and Leisure  (WCTL) in the context of the Great Bay Area. The future, at least in terms of connectivity, is no longer in our hands.

Nothing in the Mainland, nothing outside of China, everything in Macau

There is no scientific evidence to support the popular idea that Chinese people are inherently predisposed to gambling. And yet, this widespread stereotype is often seen in films, books, and even newspaper articles.

MB October 2020 Special Report | The Chinese Gambler

Still, it is impossible to deny what appears to be a greater interest in gambling among the Chinese.

Over the next few pages, the reader will find countless perspectives on the ‘Chinese gambler’ — from the myth to the player’s profile, through Mainland China’s efforts to crack down on illegal gambling and by understanding the relationship that the full-time inhabitants of Macau have with their ubiquitous casino neighbours. 

This issue is more pressing than ever; in late August, China announced the creation of a blacklist system for cross-border gambling tourist destinations, aiming to combat the rising number of Chinese outbound gamblers.

At this point, it is still unknown how this blacklist will work, but it seems clear that it will have a direct impact on many Chinese gamblers (especially the high-rollers) and an indirect effect on Macau — it was likely designed for that purpose as well.

All in all, this special report delves into a fascinating and somewhat intriguing topic by providing a diversified (and hopefully interesting) approach.

Co-ordinated by João Paulo Meneses

jpmeneses@macaubusiness.com

Our neighbour

The opening of new resorts and the increase in the supply of gaming tables does not seem to have been enough to entice more Hong Kong residents to come and gamble in Macau. 

Gambling in Hainan?

Will China ever allow gambling outside of Macau? The answer seems obvious, but the truth is that, until the beginning of the last decade, those responsible for the Hainan Province had nurtured the dream of getting an exception. 

Fighting the “opium of the 21st century”

Diplomacy, education and law enforcement are key tools employed by mainland Chinese authorities to crackdown on illegal gambling, particularly online gambling, labelled by a mainland Government spokesperson as “a most dangerous tumour in modern society detested by people all across the world” 

Ashamed or only cautious?

Common sense says that the main reason for Chinese tourists to come to Macau is to gamble. But numerous academic studies show the opposite. Is playing at casinos less and less important?  

Living between the casino and the school 

Studies show that Macau residents now go to casinos less than they did before 2004. What they really want is to buy Mark Six lottery tickets. 

GD (depression, bipolar disorder, anxiety)

Macau residents may not be very interested in casinos, but that does not prevent pathological gambling from being a pressing issue  

Las Vegas. 拉斯韋加斯

The Chinese New Year weekend already rivals the Superbowl in Las Vegas. The Strip is increasingly Chinese … 

Secrecy is the name of the game

The better we know the customer, the better the service can be provided. But getting to know the Chinese gambler is not easy. We examine some of the things that are known. 

The myth of the Chinese gambler

There does not seem to be a scientific consensus on a special ethnic Chinese appetite for gambling. Some factors, such as superstition, may explain a greater interest, but there are those who warn against simplistic generalizations.

… and it all started in China

3000 years before Macau was the gambling capital of the world, Keno was born in China.

The ‘two bombs’ and beyond

MB September 2020 Special Report | Understanding Hong Kong – A to Z

The first list of these special reports is planned at the end of the previous year. In other words, when this one about Hong Kong was conceived, we were at the end of 2019 weeks after the overwhelming majority secured by the opposition in the November district council elections. The political highlight of 2020 was expected to be the Legislative Council Elections, scheduled for September. We would also simultaneously assess the impact of last year’s anti-extradition bill protests. 

However, early in the year, the Covid-19 pandemic caused a huge disruption and the projections for 2020 started to change. It was the first ‘bomb’.

Six months later, the elections were delayed for a year because of a spike in Covid-19 cases, but the passage of a national security bill by Beijing virtually changed everything many people thought they knew about Hong Kong. It was the second ‘bomb. 

Will we be facing “the end of Hong Kong” as we know it, as Timothy McLaughlin wrote in The Atlantic or, paraphrasing Mark Twain, the news of the “death of Hong Kong” is clearly exaggerated? Will this offer a “new beginning” for a “stable and prosperous” city as Hong Kong businessman Alan Zeman predicts? What lies ahead for One Country Two Systems?

So we prepared this work against the backdrop of significant uncertainty, but we are convinced that it becomes more urgent to get a grip on what is taking place and understand this overly complex situation. 

We hope to help the reader in this goal.

Co-ordinated by João Paulo Meneses

Alliance – It is curious how, in a strongly polarized society like Hong Kong, the word that gathers the most consensus is… alliance (聯盟). Alliance is the key word in Hong Kong politics, with alliances of all types and shapes.

It all started in 1989, with the creation of the Alliance in Support of Patriotic and Democratic Movement in China (ASPDM) in response to the People’s Liberation Army’s (PLA) suppression of the pro-democracy demonstrators in Beijing’s Tiananmen Square on June 4th. It has been labeled subversive by the mainland Chinese authorities; some key ASPDM members, such as the late Szeto Wah, former legislator, and ASPDM chair, were never able to re-enter China.

A few years later, the alliance also served to describe a pro-Beijing conservative political organization, mostly composed of businessmen and professionals. The New Hong Kong Alliance, launched by the late former lawmaker and executive counselor, Lo Tak-Shing, was considered to be one of the most conservative pro-Beijing organizations, standing out the secretary 

from The Hong Kong Progressive Alliance, another pro-Beijing pro-business political party, the Democratic Alliance for the Betterment and Progress of Hong Kong (DAB) was born in 2005. Chaired by Starry Lee, DAB became one of three major parties in the city right after the 1997 handover, alongside the then leading opposition group, Democratic Party, and the pro-business (and pro-establishment) Liberal Party.

Between 2010 and 2013, 12 pan-democratic groups formed the Alliance for True Democracy, comprising 27 opposition legislators, in a bid to achieve full universal suffrage in Hong Kong.

The range of options is not complete without a reference to the Alliance, “a group of moderate, often pro-government, independent Legislative Council (LegCo) members who act as a third LegCo force between the pro-democratic and pro-Beijing camps. Without political party affiliation, they are all elected through the LegCo functional constituencies.”

Benny Tai – This former Associate Professor of Law at the University of Hong Kong has become in recent years one of the most, if not the most, influential opposition political activists and intellectuals. 

Over the past few years, he has been the ideologue of the movement to challenge the SAR’s government and Beijing’s interests in Hong Kong.

He is one of the names behind the “Occupy Central with Love and Peace, a self-declared  “non-violent civil disobedience campaign to pressure the Hong Kong government to implement full democracy in 2014.” After the protests, he launched the “Operation ThunderGo” in the 2016 Legislative Council election, aiming at getting the most pro-democracy candidates elected. 

Benny Tai is also the brain behind the successful “Project Storm” for the opposition to win the majority in the 2019 District Council election. 

In March 2018, he received all-around attacks from the Beijing and Hong Kong governments, the pro-Beijing media and politicians for his remarks on Hong Kong independence.

His statements suggesting the city could consider independence or enter into a confederation with other regions of China became famous and gave rise to serious rebuttal by mainland Chinese authorities and pro-Beijing legislators. Once in particular, DAB lawmaker Holden Chow Ho-Ding, accused the activist of turning Hong Kong’s streets into “rivers of blood.” Tai argued he was exercising academic freedom by considering such a possibility. 

Even before Beijing’s intention to create a national security law for Hong Kong was known, Benny Tai revealed his plan for the elections initially scheduled for this month: a “massive constitutional weapon” or the (impossible?) dream of a pro-democratic majority in the 70-seat council: the “35 plus strategy.” He claimed: “The Legislative Council majority is the most lethal constitutional weapon.” 

After learning the details of the new law, Tai appears to have abandoned his plans: “This is the end of one country two systems and the process to ‘authoritarian-ize’ Hong Kong is completed” the legal scholar told ABC News. “Hong Kong people have made history again,” he also said after almost 600,000 participated in the primary election for the city’s opposition. Last July, Tai was sacked by the publicly funded University of Hong Kong, over his criminal convictions last year over public nuisance offences related to the civil disobedience movement he co-founded in 2014. 

Covid-19 – The truth is that when the opposition candidates overwhelmingly won last November’s District Council elections, the street protests that dragged on from June, were already losing steam. After the vote, this was accentuated.

Even so, small groups of protesters were still involved in rows with the police, especially on weekends.

At that time, too, it was already clear that the Government would not yield to any of the demands other than dropping the extradition bill. So many people asked how to resolve the impasse? How to return to normality?

Before an answer could be provided, Hong Kong was dealing with the greatest pandemic that humankind has experienced in one hundred years.

A tourist hub and an economy very dependent on mainland Chinese consumers, Hong Kong had to close its borders and closed itself at home. Street protests stopped.

In fact, the authorities continued to invoke the need to avoid gatherings and to respect social distancing in order to ban June 4th vigil (Tiananmen) – which, nevertheless, went ahead – and June 12th (first anniversary of the first major anti-extradition clashes). A few thousand people took to the streets, but an evident minority.

It was in this context of great concern over the risk of Covid-19 contagion that the Central Government imposed the new national security bill on June 30th.

In July, Hong Kong saw a spike in Covid-19 cases, bringing to daily number of cases to over one hundred. In late July, Carrie Lam invoked the emergency ordinance to postpone the LegCo election by one year, citing the resurgence of coronavirus cases, signalling a political impact of the pandemic in the city.  The opposition has accused the government of using the pandemic as a pretext to stop people from voting, but Chief Executive Carrie Lam explained: “This postponement is entirely made based on public safety reasons, there were no political considerations”. Seventy-one countries have so far delayed elections due to Covid-19.

As for the economic impact of the pandemic on the local economy, it is too early for numbers.

“The magnitude of Hong Kong’s economic recession in the first quarter may be worse than in the 2008 global economic tsunami, or the impact of the Asian financial crisis [1997-1998],” said Financial Secretary Paul Chan Mo-po.

There will also have to be added the impact resulting from almost a year of protests. The numbers point to HKD 18 billion decrease in retail sales between Q1 and Q3 of 2019, caused by the lack in tourism. In addition, this caused a 3.7 percent GDP drop during the same period.

Disqualification – One of the features in recent years of Hong Kong’s political-electoral system is called disqualification.

Since the last Legislative Council election in 2016, a total of six elected legislators from the pan-democracy, localist, and “self-determination” camps ended up being disqualified as a result of their behavior during the oath-taking ceremony. Two pro-independence members displayed a “Hong Kong is not China” banner and mispronounced China’s name in an insulting way. Other elected legislators were disqualified over inserting their own words, including anti-government and anti-Beijing slogans while reading the oath.

There were also young radical opposition politicians – seen as “pro-independence” – who got disqualified from running in local district council elections due to their opposition to the Basic Law. 

So, since 2016, all candidates, before they’re able to qualify as such, should first affirm their support to the Basic Law by signing a new form pledging to uphold the “mini-constitution”. A decision on whether they truly uphold the commitment is then taken by a returning officer. Signing the form may not be sufficient to guarantee a place on the ballot papers. Back in 2016, separatist activist Edward Leung signed the declaration, but was eventually disqualified, as the returning officer did not believe him quoting his publicly known advocacy for Hong Kong independence.  

More recently, Tam Yiu-chung, Hong Kong’s only representative in the NPC Standing Committee, wrote that candidates who oppose the new National Security bill “should be disqualified.”

But, as Carrie Lam seems to have acknowledged, the situation can be somewhat ambiguous: “I cannot simply say what acts or speeches will disqualify a person. The most important thing is to act according to the law”, she said.

On the other hand, Tian Feilong, a legal expert on Hong Kong affairs at Beijing’s Beihang University, said “Under the nationals ecurity law for Hong Kong, the legal boundaries have become much clearer”. Tian told Global Times that  “opposition groups should know how to adjust to a changing environment”.

After the new law was implemented, Hong Kong authorities warned that popular protest slogan  “Liberate Hong Kong, the revolution of our times” has the “connotation of separating the HKSAR from the People’s Republic of China (PRC)”, signaling a new red line.

Pro-Beijing heavyweight Maria Tam said she believed returning officers failed to properly vet candidates, because no one had been disqualified due to the slogan in local district councils elections. 

Against this backdrop, Civic Party (pro-democracy) leader Alvin Yeung, stated: “No one in the opposition can guarantee that they would be able to get into the race.” Last July, officers at the Electoral Affairs Commission informed that 12 election nominations had been ruled invalid, once the candidates’ “intention” to uphold the Basic Law and swear allegiance to the HKSAR was not deemed “genuine and truthful.” Some days later, the elections were delayed for a year. Among them are four legislators currently serving in the Legislative Council: Civic Party’s Alvin Yeung and Dennis Kwok and Kwok Ka-ki and indirectly elected lawmaker and accountant Kenneth Leung.  

Extradition bill – No one could have imagined that a crime committed in Taiwan in early 2018 would change the course of Hong Kong’s history.

In fact, if 2019 was the most turbulent year in Hong Kong’s recent history, it’s due to the crime that 19-year-old Hong Kong resident Chan Tong-kai confessed to committing (he murdered his pregnant girlfriend Poon Hiu-wing in Taiwan). Chan admitted to Hong Kong police that he killed Poon, but the police were unable to charge him for murder or extradite him to Taiwan because no agreement was in place between Hong Kong and Taiwan.

The case led pro-establishment forces to ask for an extradition bill, which was confirmed when, in February last year, Carrie Lam’s cabinet proposed the Fugitive Offenders and Mutual Legal Assistance in Criminal Matters Legislation (Amendment) Bill, which would come to be known as the extradition bill.

The document was immediately contested, and some in the pro-Beijing camp even demonstrated their reservations. But it was on the streets that the situation quickly escalated, culminating in the mega-demonstration that took place on 9 June, which organizers say was joined by one million people (the police only counted 270,000 participants). In addition to asking that the proposal be rejected, protesters also asked for the resignation of the Chief Executive.

A few days later, Lam announced she would ‘suspend’ the proposed bill, and on 23 October, Secretary for Security John Lee announced the government’s formal withdrawal.

But that was not enough to silence the street protests, which soon turned into veritable street battles (read violence) and requests for greater democracy (universal suffrage).

The Covid-19 pandemic ended the protests. Four months later, Beijing introduced the national security law. 

Understanding Hong Kong – A to Z (F – J)

Future (the) – When one talks about Hong Kong’s future they are not referring to 2021 or 2025, but 2047. So there is a lot of time before then. And if six months ago very few people could anticipate that a couple of months later Beijing would pass a sweeping national security bill that would change the Region, speaking in the long term may seem unwise.

Understanding Hong Kong – A to Z (K – O)

Kingdom, United – The announcement that about three million Hong Kong residents may have a pathway for British citizenship has caught nearly everyone off guard. “This would amount to one of the biggest changes to our visa system in history,” Boris Johnson wrote.

Understanding Hong Kong – A to Z (P – T)

‘Peg’ – Felix Chung, leader of the pro-Beijing Liberal Party, warned: If the United States includes the Hong Kong’ dollar’s 36-year-old currency ‘peg’ with the US dollar in sanctions related to the national security bill, thereby denying Hong Kong access to the U.S. dollar, “this will be the end of Hong Kong.” As is known, the Macau pataca is indexed to the neighbouring region’s currency.

Understanding Hong Kong – A to Z (U – Z)

Universal suffrage –  It is common to hear that Macau and Hong Kong, despite the same cultural, linguistic, social, and political matrix, are going separate ways.
The objective of choosing policymakers through universal suffrage is one of the main marks of these divergent paths.

“The Future is Feminist” *

In December last year we published the list of the 20 most influential people in Macau.

And we realized that they were almost all men.

MB August 2020 Special Report | 20 (+20) influential women

Two immediate conclusions: Macau is still a male-dominated society, although more women are taking up positions (just look at the recent appointments made by the current Chief Executive) and we needed to make a women-only list.

This is what we present in this issue of Macau Business.

Now, as before, we say this is a seemingly impossible task, since there are virtually no entirely objective criteria for choosing the names and as any list, under these conditions, our endeavour is bound to be challenged. 

Now, as in the past, we realize and accept this shortcoming.

But it is more important to go ahead with it.

And the truth is that, with this list, we highlight not only the three that were on last year’s list, but another 17 women who equally stand out in Macau’s life.

And, as in the 2019 list, we add 20 more, who, despite not being arguably as influential as the top 20, are also movers and shakers.

* “The Future is Feminist” is the name of a book edited by Mallory Farrugia (2019)

Co-ordinated by João Paulo Meneses

jpmeneses@macaubusiness.com

Special Report – “The Future is Feminist” * (1 – 5)

Special Report – “The Future is Feminist” * (6 – 10)

Special Report – “The Future is Feminist” * (11 – 15)

Special Report – “The Future is Feminist” * (16 – 20)

Special Report – The other 20

We really need alternatives to VIPs

Put 1000 people in a room in Macau and ask them: does Macau need to diversify its tourism?

MB July 2020 Special Report | Crossroads of Macau tourism

990 will answer “yes”; the theme generates a rare and profound unanimity locally.

Then ask the 990 how to diversify that same tourism and we will surely get dozens of different answers.

It will be almost each to his own taste.

The Government, for example, after recognizing the failure of the MICE bet, is now betting on major sporting events. But in order to be able to attract new tourists, they have to be high impact sporting events. It’s not enough for Inter Milan to play with PSG …

We will talk about it in this special report.

We add to this, cultural tourism (heritage), gastronomy, luxury products and even niche proposals such as ecotourism or religious tourism.

However, it seems clear that, given the limitations in Macau, it will be easier to diversify through Hengqin, as Ho Iat Seng has been advocating.

PS – And the remaining 10, the reader asks? Yes, there is a minority of people in Macau who understand that VIP customers of gambling rooms will be not only the salvation post-Covid-19 (and they are true), but also the solution to any problem that tourism may have. For this minority, there is no need to do anything, except to not spoil what already exists.

To be clear: VIP customers are important, but Macau has to find alternatives.

Co-ordinated by João Paulo Meneses

jpmeneses@macaubusiness.com

To VIP or not VIP, that’s the question

Does Macau need better tourists or does it need to bet more on the high rollers? Is the future of tourism in China or abroad?

Looking for new policies

“Stay one more night, visit one more day” is the government’s new goal. It remains to be seen how this will happen, and whether there will be less investment in MICE and more demands on non-gaming businesses.

Diversification?  “Is the responsibility of the government. Not IRs”

The same person who worked at the Venetian, Grand Lisboa and MGM Cotai, Niall Murray has a long list of clients and work completed, through Murray International Group, which he founded and directs. With work carried out in places as diverse as New York, Beijing, Paris or Las Vegas, he is based in Macau and “is one of the leading experts in designing, developing, opening and operating the world’s largest and most successful Integrated Resorts & Multi-use properties.”

Food: a must do

Gastronomy is one of the areas with the most potential for local tourism. Not only because there is interest from tourists but also because it allows for the development of local identity – unlike luxury shopping, for example.

Mega events? Watch out!

It is not enough to bring (mega) events to Macau and expect them to attract thousands of tourists. First, we need to understand what Chinese tourists want. It will certainly not be exactly the same as in Las Vegas.

Little Mice

MICE industry (meetings, incentives, conferences and exhibitions) is not bringing the expected results to Macau. The Government talks about collaborating with Hengqin, but one must not forget the mega-investment that Galaxy is making and which will open next year. 

Shopping, how Macau dwarfed Hong Kong

In just a few years, Macau has become a giant shopping mall with all the luxury brands on display. Often at the expense of Hong Kong. Studies say that tourists spend little because they spend little time here. 

Religious tourism, risks and opportunities

Could local Catholic processions, which – in Greater China – only exist in Macau, make a contribution to tourist diversification? Japan has people interested, and Vietnam could be a benchmark.

Hengqin, “the second Macau”

Even though the difficulties are still noticeable, ties between Macau and Hengqin are tightening, driven by the current Chief Executive who sees the future of economic diversification over there, a stone’s throw away.

Recovery? VIP + IVS

There is little certainty about the recovery of the tourism market (gambling…) in Macau, but these two acronyms will be decisive. When will the recovery be complete? Nobody knows.

No more studies and experiments

During a Legislative Assembly session that took place in March, several legislators spoke of the need to diversify the economy.

MB June 2020 Special Report | Diversification now or never 

There were those who asked for more investment in traditional industries, some pointed to the need to organize more sports and cultural events, while others suggested that casino concessionaires should bear the responsibility of revitalizing a given district or area or even creating an industry for the production of gaming cards and slot machines.

For almost 15 years, Beijing has been urging Macau to diversify its economy, but this has yet to come into fruition. One after another each member comes to parliament and leaves a suggestion so different and opposed to the previous one that its sounds like a completely out-of-synch orchestra.

There is a time to discuss and a period to move forward.

Almost15 years is more than enough to deliver results.

Hence, Ho Iat Seng’s words in his maiden Policy Address could not have been more radical and clear as MICE and creative and cultural industries together account for less than one per cent of the SAR’s Gross Domestic Product (GDP).

“The excessive and prolonged dependence on the gambling and tourism sector, and if the monolithic nature of the industrial structure remains unchanged, will hinder the sustainable development of the Macau economy,” a Chief Executive statement that will be remembered many years from now.

This, and much more, is what we promise in this special report, making use of the best pundits that Macau has at its disposal.

Once and for all: is Hengqin the way forward? Let us then follow this path swiftly and in force!

Co-ordinated by João Paulo Meneses

jpmeneses@macaubusiness.com

Doctor, doctor, give me the news

It is a diagnosis made by scholars from around the world: the economic diversification of Macau is a very difficult task. The Chief Executive’s speech was clear and unequivocal. 

Gambling: problem and solution

Macau would not be what it is without gambling. But at the same time, gambling seems to dry everything around it. How to square the circle?

No land, no manpower, no infrastructure

Any attempt to diversify the economy is conditioned by the lack of land, qualified staff and infrastructure. The diagnosis is made but few want to see it. 

“Moderate” or “adequate”

It may just be a matter of synonyms, but we had to understand what’s really in it  

“Las Vegas does not fit Macau”

The time when Las Vegas was the model is long gone. There are good things in Nevada casinos, but many other things simply don’t work here. 

The Chinese ear tug

China ‘asks’ for more diversification and less reliance on gambling, and Macau responds with the results achieved. Beijing insists, a sign that it is not satisfied. Is Ho Iat Seng the solution? 

Will non-gaming ever make any money

It is one of the dilemmas to be solved in the Macau economy: non-gaming is the solution to diversification or just help, although it costs a lot of money. 

Hengqin is the way

The Hengqin Project was first brought to the table in January 2009 by Chinese Vice President Xi Jinping, who is convinced that the development of Hengqin Island will provide new areas for development and diversification within Macau’s economy. Ten years later, the Chief Executive says there is no doubt, it is necessary to reach the bridge to diversify the economy. 

New ideas? Online gaming

A stock exchange? A financial centre? Traditional Chinese Medicine? Creative industries? Ho Iat Seng said what he thinks about the ’emerging industries’ and he has not revisited the ideas associated with Xi Jinping’s last visit. However, it left the door open to ground-breaking news. 

Casinos, housing and schools

Schools just a few dozen meters from casinos? It takes place in Macau. It is therefore no wonder that different surveys have found that young people in Macau are more at risk of gambling addiction.

MB April 2020 Special Report | Youngsters living on a keyboard

But this is not the only distinguishing feature of what will become of the age group with the highest demographic weight in Macau: the fact that young people, even at school age, say that housing is one of the main concerns is another distinguishing mark.

Finally, we are talking about generations of netizens, all of them online.

Just to see social media or shop on Taobao? There are those who guarantee that this is also a generation of “keyboard fighters.”

This special report talks about all that and more, aiming to portray young people in Macau, now that the Youth Policy, which started in 2012, is over.

A portrait that also includes educational issues, allowing me to draw readers’ attention to the problem denounced by educationist Keith Morrison, one of the specialists who, with his contribution, helped to enrich this work: “In some higher education institutions in Macau there are two communities: the local do-as-little-as-necessary students and the non-local-work-hard students; it’s deep in the local culture.”

Co-ordinated by João Paulo Meneses

jpmeneses@macaubusiness.com

Government promises new youth policy

The Government is already working on a successor to the Youth Policy (2012-2020). In the second half of this year there should be news. But the assessment that has already been made is quite positive.

The power to the young

If the Government seems to be attentive to the needs and desires of young people, it will be much more so in the future, when they assume themselves as the most significant population group.

Too young to think about homes

It is another idiosyncrasy of Macau (and Hong Kong…): when local young people, of school age, are asked what their main concern is, they respond that there is a lack of housing or that the housing available has a very minimal space, which is barely adequate. 

Be aware of gambling

Twenty percent of young people in Macau may have a gambling-related addiction. Quitting addiction is even more difficult in a land where it is everywhere (even online). 

School dropout. Not anymore.

The idea that students leave university with ease to go work in casinos makes less and less sense. They do finish their degrees, but the quality of what they learn is doubtful, experts say.

You must be a talent!

It is too early for results, but it is possible that Fernando Chui Sai On will be remembered as the ‘father’ of the talent training program implemented in Macau. 

“The Internet is twisting the values”

Older people are frightened by the way younger people connect to the internet and mobile phones. In Macau, there are warnings of over-dependence on mobile phones that may lead to excessive attention to online social communication and less interest in real life. 

With (patriotic) education

Patriotic education is almost widespread in schools in Macau. Added to this is the fact that many students were born in the PRC. Xi Jinping, on his recent visit to Macau, could not be more satisfied. 

Indifference of some young people “is shocking”

In the opinion articles he writes monthly at Macau Business, Professor Keith Morrison is presented as an author and educationalist. As the interview we published on these pages proves, Mr. Morrison is more than that. He is probably the most lucid mind when it comes to youth in Macau. Keith Morrison came to Macau in 2000 and has worked with several universities. He is currently vice-rector of the University of Saint Joseph.

“Keyboard fighters”

Young people in Macau are not as distanced from reality as they seem. There are several factors that explain how different they compared to youngsters in Hong Kong, but the future will bring a more intervening generation.

Adds response from DICJ

The Gaming Inspection and Coordination Bureau (DICJ) is preparing to impose an instruction (Instrução nº3/2019) this coming Monday limiting gaming concessionaires and sub-concessionaires in Macau as well as other gaming operators known as junkets, any “transfer of information about gaming activities or operations, including customer personal data” for third parties, in the SAR or elsewhere.
The instruction, accessed by Macau News Agency (MNA), signed by DICJ Director Paulo Martins Chan and expected to come into force on 23 September, defines information on gambling activities or operations as “all data related to the individual and object of the gambling activities, or related to the operation of casinos and gambling activities, including but not limited to the personal data, place of origin or nationality, profession or the gambling clients’ activity and other information such as their representatives or accompanying persons, the time of entry into and out of the casino or the gaming table, the amount of bets, the credit, the amount of the bet placed, the payment of prizes and the purchase and redemption of chips (tickets), slot machines tickets (tokens), etc.”
The prohibition on the transfer of information goes further, “including and not limited to the company, the representative, the branch or the delegate of its associated entities or the same economic group.”
An exception to this rule is possible, says the DICJ instruction, but only when “the consent or power of attorney of the interested parties were obtained or are in compliance with the provisions of the Personal Data Protection Act.” However, “authorization from DICJ for each concrete transfer act” will be mandatory.

To obtain permission

The document, to which MNA had access, also defines the necessary explanations that gaming concessionaires and other operators must provide to DICJ in order to obtain the permission to disseminate the information. Namely the type of information, the entity that will receive it, if it to be sent outside the SAR, and for what purpose.
DICJ further reserves the right to request “any further clarifications or documents” as well as the power not to make “any occasional or generic authorization.”
All information is now considered “confidential” and game operators and junkets are required to “maintain confidentiality” as well as “take appropriate measures to prevent” its disclosure.
A duty of confidentiality that will remain “even if there has been a waiver or loss” of the respective gaming license.

Experts caught by surprise

Experts heard by MNA consider this statement “at the very least strange… It will have a strong impact, preventing information from being reported, for example, to regulators in other jurisdictions or to hotels owned by concessionaire and sub-concessionaire groups,” an analyst told Macau News Agency, predicting a “negative impact on stocks” of gaming operators in Macau.
On the other hand, he said, the Data Protection Act in force only requires authorization of the person concerned. With this instruction from the DICJ, the bureau “has powers to dispose against express law,” explains the same expert.
A Macau law expert, who also prefers to remain anonymous, told MNA this decision seems “unusual and clearly inappropriate and disproportionate.” And asks: “Why these restrictions? To what end? What happened before to justify these draconian measures?”
For this expert, “it seems clearly meaningless and senseless and violates legal norms that override instructions, namely commercial law norms, in particular, the unimaginable clause that prevents information for parent companies and others!”
Among the concerns is also the “form of instruction, that seems illegal for various reasons,” he says.
And lastly, “if the new competition for gambling concessions is coming, what is the framework: Unfair competition or to keep away certain foreign interests, namely Americans?”

DICJ denies violation of rules

In a written response to Macau News Agency, DICJ confirms the intention to impose its prior authorization but denies that any rules are being broken with the new norm.

“It is intended to ensure that the transfer of information about gambling activities by gambling concessionaires / sub-concessionaires and game promoters is in accordance with the SAR law, in particular with the legal regime governing the development of games of chance, the law on the prevention and suppression of money laundering crime and other legal acts, thus ensuring the healthy development of the same sector”‘ says the SAR’s regulator.

“The purpose of the instruction is not to completely prohibit the transfer of information by game concessionaires / sub-concessionaires and game promoters, but to subject it to the prior authorization of DICJ. These requests will be subject to consideration within the scope of their legal provisions and therefore there is no violation of the rules on the exercise of the respective rights”, explained DICJ to MNA.