Overview

Macau, officially known as Macau Special Administrative Region of the People's Republic of China (PRC), is a former Portuguese territory that reverted to Chinese sovereignty on 20 December 1999.

Macau is governed by the Basic Law of the Macau SAR (the Basic Law), passed by the PRC's National People's Congress (NPC) in 1993. The Basic law serves as Macau’s ‘mini-constitution’. It provides for independent executive, legislative and judicial powers, and accords the territory a high degree of autonomy under the principle of 'one country, two systems' in all areas except defence and foreign affairs (for which China is responsible).

Chief Executive

The Basic Law designates a system of governance led by a Chief Executive (CE) and an Executive Council, with a two-tiered system of representative government and an independent judiciary. The CE makes policy decisions and has the power to initiate legislation. According to the basic law, the CE is “accountable to the Central People's Government and the Macau Special Administrative Region”.

The CE is appointed by Beijing after election by a 300-member Election Committee representing Macau's business, cultural and social interests. CEs are elected for five years and limited to two terms in office. Ho Iat Seng was sworn in as Macau’s third CE on 20 December 2019, replacing Dr Fernando Chui Sai.

Legislative Assembly

The major functions of the Legislative Assembly are to enact laws, examine and approve budgetary matters, monitor the government's performance, and debate issues of public interest.

The most recent elections for the Legislative Assembly took place on 12 September 2021. The Legislative Assembly is currently on its 7th term with all 33 members elected for a term of four years. Of the 33 seats, 14 are directly elected by voters, 12 are indirectly elected by the members of traditional functional constituencies representing occupational and other special interest groups, and seven are appointed by the CE.

On 9 July 2021, Macau authorities disqualified all pro-democracy candidates from running in the Legislative Assembly elections. The grounds for the disqualification were that individuals had either not upheld the Basic Law, or not met requirements to pledge allegiance to the Macau SAR. Voter turnout at the 12 September elections was 42 per cent, the lowest since the establishment of the Macau SAR. No institutions of government in Macau are elected through universal suffrage.

Judiciary

Macau's legal system is based on the Portuguese Civil Law. Under the Basic Law, the judiciary is independent of the executive and legislative branches of government. The judiciary comprises a Court of First Instance, a Court of Second Instance, a Court of Final Appeal, a Lower Court and an Administrative Court. Members of the judiciary are selected by an independent committee and appointed by the CE.

Economic overview

For 2021, the economy of Macau rose 18 per cent year-on-year. In 2021, Macau’s exports of goods rose by 20.8 per cent while imports of goods rose by 44 per cent. Macau’s key exports are gaming and tourism. Gaming has been licensed in Macau since 1850 and attracts large numbers of gamblers from mainland China. The gaming industry dominates the local economy, providing over 70 percent of total employment.

Macau’s economy remains vulnerable to shocks affecting the gaming sector. Following the COVID-19 induced temporary closure of casinos, GDP decreased by 56.3 per cent in 2020. Since 2020, the economy has been undergoing a significant transformation. The Macau government has been encouraging non-gambling tourism and is seeking to attract more conference and business visitors, including by developing new infrastructure to service these sectors. Diversification efforts have focused on growing the MICE (meetings, incentives, conventions and exhibitions) tourism segment, as well as sport, leisure and entertainment.

Macau leases Hengqin Island from the PRC. Hengqin is being developed as a mixed-use area, with theme parks, resorts and residential buildings planned, and is emblematic of efforts by the Macau SAR Government to diversify its economy beyond the casino industry.

Mainland China is Macau’s most important import source. Macau depends on China for most of its food, fresh water, energy and, increasingly, labour. Infrastructure projects such as the Hong Kong-Macau-Zhuhai Bridge (opened 2018) further connect Macau with the greater Pearl River Delta and boost cross-border trade.

Macau is also part of China’s Greater Bay Area (GBA) initiative, which seeks to improve connectivity between the Guangdong, Hong Kong and Macau economies.

A Closer Economic Partnership Arrangement (CEPA) between Macau and China came into effect in 2004, initially covering select trade in services and investment. It now comprises several supplements and has brought about greater liberalisation of trade in services, and a relaxation of market access conditions with the mainland.

A CEPA Agreement between the Mainland and Macau on ‘Achieving the Basic Liberalisation of the Trade in Services in Guangdong’ came into effect on a pilot basis as of 1 March 2015. Then in November 2015, both parties signed a further CEPA on the Trade in Services, which came into effect on 1 June 2016. Trade in services between the Mainland and Macau is now fully liberalised.

Macau signed a CEPA with Hong Kong in October 2017. The Arrangement covers trade in goods and services, investment, intellectual property, and economic and technical cooperation. The commitments on liberalisation of goods and services trade (implemented in January 2018) go beyond those undertaken by Hong Kong and Macau under the World Trade Organization.

Macau’s other major trading partners include Japan and Switzerland, with consumer and capital goods being its major imported items.

Bilateral relations

Australia has strong business interests in Macau. These include interests in the gaming sector, education, hospitality, creative services, construction, consumer products and food and beverages.

Macau’s efforts to diversify its economy could provide further opportunities for Australian businesses, including in areas such as premium food and beverages, digital technology, design and services for smart buildings, and environmental management.

An Australian Chamber of Commerce in Macau (AustCham Macau) was formally launched in January 2019 to provide targeted support to the Australian business community in Macau, and to promote trade and investment opportunities.

In 2021, the total value of Australia’s two-way merchandise trade with Macau was $46 million. Major Australian merchandise export items include alcoholic beverages; live animals (excluding seafood); prams, toys, games and sporting goods, and watches and clocks.

Australia's main merchandise imports from Macau are telecommunications equipment and parts; footwear and prams, toys, games and sporting goods.

However, trade statistics may understate the true level of exports from Australia to Macau because there are few direct shipping services and many products, especially food and beverages, are repacked and trans-shipped via Hong Kong. These are not recorded as being of Australian origin.

Australia and Macau signed a Tax Information Exchange Agreement on 12 July 2011, and a Memorandum of Understanding on immigration cooperation on 19 November 2013.

In 2016, Australia and China agreed to bring Macau under the scope of the Australia-China Agreement on Consular Relations.

Approximately 2,000 people of Macanese descent live in Australia and around 2,000 Australians live in Macau.

Consular services for Macau are provided by the Australian Consulate-General in Hong Kong.

In 2021, Macau ranked 47th as a source location for international students to Australia. In 2021, 682 students from Macau studied in Australia, down from 774 in 2019. There were 607 student enrolments in Australia from Macauin higher education, followed by 54 student enrolments in VET in 2021.

Information on doing business and opportunities in Macau.