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Decoding a 25-year economic, social miracle

City's success linked to proximity to mainland, strong economic integration

By WILLIAM XU in Hong Kong | China Daily | Updated: 2024-12-18 08:24
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National flags of China and the Macao SAR's regional flags hang in a street to celebrate the 25th anniversary of Macao's return to the motherland. [FENG YONGBIN/CHINA DAILY]

Evolving economy

However, the substantial wealth has not blinded Macao to the potential pitfalls of dependence on the gaming industry. In recent years, the city has adopted different approaches to diversify its economy in a healthy and sustainable way.

By 2023, the non-gaming sector contributed over 60 percent of the city's GDP, exceeding the proportions 20 years ago. Key drivers of this surge included the real estate and business services sector, as well as the banking and insurance industry.

Entrepreneurs are pioneering innovative business models to adapt to the evolving economic landscape. Chan, the pharmacy chain owner, has recognized mainland customers' growing use of online shopping. This has prompted him to learn e-commerce from his mainland peers and revamp the services he offers.

In 2023, the Macao SAR government released a blueprint for economic diversification, which charted road maps to boost four emerging sectors: big health, financial services, high technology as well as the convention, exhibition, trade, cultural and sports industries.

Sam Hou-fai, the city's incoming chief executive, has made exploring forward-thinking reforms on the city's economic structure a cornerstone of his agenda. Other focuses include improving people's livelihoods, advancing integration with the nation's development, and strengthening collaboration with Portuguese-speaking countries.

Meanwhile, Macao has stepped up its economic and social ties with other cities in the Guangdong-Hong Kong-Macao Greater Bay Area, which was marked by the inauguration of the Hong Kong-Zhuhai-Macao Bridge in 2018.

Hengqin, a development zone under the jurisdiction of Zhuhai, located just 4 kilometers from the Cotai district, is a new key to Macao's transformation ambitions.

In 2021, the central government released a comprehensive plan to advance the development of the Guangdong-Macao In-Depth Cooperation Zone in Hengqin, deeming the 106-sq-km area — three times the land size of Macao — an indispensable base for the SAR's second transformation from a leisure hub to a moderately diversified economy.

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