JOINT REPORT TO THE EUROPEAN PARLIAMENT AND THE COUNCIL Macao Special Administrative Region: Annual Report 2016
Date: 2017-04-26
Institutions: European Commission, European External Action Service
Subjects: Macao, bilateral relations, democratisation, economic cooperation, economic situation, economic transition, human rights, political situation, regional cooperation, regional integration

EN 

   EN 

   EUROPEAN COMMISSION HIGH REPRESENTATIVE OF THE UNION FOR FOREIGN AFFAIRS AND SECURITY POLICY Brussels, 26.4.2017  JOIN(2017) 15 final   JOINT REPORT TO THE EUROPEAN PARLIAMENT AND THE COUNCIL Macao Special Administrative Region: Annual Report 2016  
 
 
JOINT REPORT TO THE EUROPEAN PARLIAMENT AND THE COUNCIL 
Macao Special Administrative Region: Annual Report 2016 

Summary 

Since the handover of Macao to the People’s Republic of China in 1999, the European Union 
(EU)  and  its  Member  States  have  closely  followed  political  and  economic  developments  in 
the  Macao  Special  Administrative  Region  (SAR)  under  the  ‘one  country,  two  systems’ 
principle.  The  EU  adheres  to  its  ‘One  China’  policy  and  supports  the  ‘one  country,  two 
systems’ principle and its implementation. 

This annual report on developments in Macao is issued in line with the commitment given to 
the European Parliament. 

In 2016, the ‘one country, two systems’ principle continued to work well, to the benefit of the 
Macao SAR, China as a whole, and the international community. 

The Chief Executive was elected, unopposed, in 2014. This was the third time in a row that 
only  one  candidate  stood  for  election  as  Chief  Executive.  Macao’s  Basic  Law  and  other 
legislative  acts  do  not  provide  for  the  possibility  of  universal  suffrage.  However,  the  EU 
encourages the Macao authorities to consider ways to promote greater public involvement in 
the  election  of  the  Chief  Executive,  thereby  enhancing  the  legitimacy  of  the  position  and 
contributing to good governance. 

The  fundamental  rights  and  freedoms  of  citizens  continued  to  be  respected.  Macao’s  media 
continued  to  express  a  broad  range  of  views  despite  some  concerns  about  increasing  self-
censorship. 

Macao’s market-based economy continued to function efficiently, although economic growth 
suffered from a marked decline in gaming revenues in the first two quarters, on which Macao 
is  over-reliant.  Macao’s  fiscal  reserves  remained  in  surplus.  GDP  growth  rebounded  in  the 
third quarter, registering an increase for the first time in 2 years. To reduce over-reliance on 
the  casino  industry,  the  government  launched  its  first  ever  Five-Year  Development  Plan 
(2016-2020). 

A  key  priority  is  improving  the  lives  of  ordinary  people,  who  face  mounting  living  and 
housing costs. Macao continues to suffer from an acute labour shortage. However, imported 
labour has become a sensitive issue, and there is no political consensus on how to address it. 
The  Macao  government  needs  to  be  modernised  and  made  more  efficient;  administrative 
reforms are ongoing. 

EU-Macao relations continued to flourish, with a growing portfolio of cooperation activities 
and  solid  trade  relations.  Owing  to  the  sharp  contraction  in  Macao’s  economy,  EU-Macao 
trade shrunk in 2016. Priorities for 2017 include cooperation on economic diversification, the 
fight  against  trafficking  in  human  beings,  legal  affairs,  regulatory  matters  and  research  and 
innovation. 

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Political developments 

The  Macao  government  concentrated  on  improving  the  region’s  law-based  governance, 
transforming  the  economy  to  make  it  sustainable  and  improving  the  population’s  living 
standards  by  reducing  social  inequality  and  increasing  the  supply  of  government-built 
housing. 

Macao’s Basic Law and other legislative acts do not provide for the possibility of universal 
suffrage.  However,  the  EU  encourages  the  Macao  authorities  to  consider  ways  to  promote 
greater  public  involvement  in  the  election  of  the  Chief  Executive,  thereby  enhancing  the 
legitimacy of the post, increasing public support and strengthening governance. 

On 9 August, lawmakers approved the amended Legislative Assembly Electoral Law, which 
aimed  to  tighten  campaigning  rules.  The  number  of  directly  elected  seats  remained 
unchanged. The aim of the amendments was to ensure that the election process was conducted 
with  integrity.  Pro-democracy  lawmakers  called  it  a  missed  chance  for  democratic  progress 
and  called  for  more  substantial  reforms,  including  a  discussion  on  the  introduction  of 
universal suffrage. 

On 16 December, the Legislative Assembly passed amendments to the Electoral Law. They 
include new requirements for oath-taking by elected officials and the eligibility of individuals 
to participate in electoral campaigns. The Secretary for Administration, Sonia Chan, said the 
amendments  were  necessary  following  the  interpretation  of  the  National  People’s  Congress 
Standing Committee regarding Hong Kong lawmakers. 

On  12  August,  the  Legislative  Assembly  approved  the  draft  legislation  complying  with  a 
United  Nations  Security  Council  resolution  on  fighting  terrorism  and  the  proliferation  of 
weapons of mass destruction, which will allow assets to be frozen. 

In the spring, the government submitted a controversial draft to the Legislative Assembly on 
‘Interregional  Judicial  Assistance  in  Criminal  Matters’  regarding  the  extradition  agreement 
between Macao, mainland China and Hong Kong. In May, the Legislative Assembly rejected 
the  draft  of  this  multilateral  deal  and  sent  it  back  to  the  government  for  review,  citing 
‘technical problems’. After a brief period of reflection in June, the government withdrew its 
draft proposal until a consensus has been reached between Macao, mainland China and Hong 
Kong,  saying  that  it  took  longer  than  expected  to  reach  an  agreement  due  to  differences 
between the jurisdiction regimes in different territories. Civil society and the legal profession 
had expressed their concerns about the implications of a possible extradition agreement. They 
also complained about not having been properly consulted. 

Around the same time, law enforcement agencies in Macao admitted to having turned over at 
least three people, two of them Hong Kong permanent residents, to the mainland authorities in 
recent  years,  despite  court  rulings  saying  that  such  extraditions  were  unlawful.  This  created 
further cause for concern regarding the ongoing discussions on an extradition agreement. In 
2015, the United Nations Committee Against Torture highlighted in its conclusions on Macao 

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the  issue  of  the  surrender  of  fugitives,  but  the  Macao  authorities  do  not  seem  to  have 
satisfactorily  addressed  this.  The  EU  reiterates  the  importance  it  attaches  to  the  rule  of  law 
and respect for human rights, and the need to comply fully with international law in matters 
such as extradition agreements. 

Equal opportunities, rights and freedoms. Under the ‘one country, two systems’ principle, 
the rights and fundamental freedoms of the people of Macao continued to be respected and the 
rule  of  law  was  upheld.  Macao  enjoys  a  high  level  of  civil  liberties  and  respect  for  human 
rights  and  fundamental  freedoms.  Nonetheless,  the  government  remained  opposed  to  a 
proposal  by  the  UN  Committee  Against  Torture  to  establish  an  independent  human  rights 
body,  arguing  that  this  recommendation  was  not  applicable  to  Macao  as  a  special 
administrative region of the People’s Republic of China. 

The media remained sufficiently diverse and were able to express a range of views without 
restriction. There appears to be a degree of self-censorship, particularly in Chinese language 
media  and  when  reporting  on  Chinese  affairs.  The  international  media  operate  freely. 
However, the Macao Journalists Association said it was deeply concerned that reporters were 
repeatedly  insulted  and  shoved  when  covering  the  Pearl  Horizon  protests  on  20  December. 
The Association said such behaviour was a violation of press freedom and expressed concern 
that  a  journalist  from  Hong  Kong’s  Apple  Daily  newspaper  was  denied  entry  to  Macao  to 
cover the protests. This is not the first time journalists and members of political groups from 
Hong Kong have been denied entry. 

There  are  continuing  concerns  about  discrimination  on  the  grounds  of  sexual  orientation 
and  gender  identity,  particularly  in  employment,  education  and  healthcare.  Same-sex 
relationships  are  yet  to  be  included  in  the  legislative  act  that  makes  domestic  violence  a 
criminal  offence.  The  UN  Committee  on  Economic,  Social  and  Cultural  Rights  has  urged 
Macao to  adopt  comprehensive  anti-discrimination  legislation  for  lesbian,  gay,  bisexual  and 
transgender people. More legislation is also needed to promote gender equality, for example 
in the area of sexual harassment. 

The  Macao  government  made  further  substantial  efforts  to  combat  cross-border  crime,  in 
particular trafficking in human beings. The Human Trafficking Deterrent Measures Concern 
Committee, an interdepartmental body comprising government, law enforcement, justice and 
social affairs representatives, continued to tackle trafficking in human beings and implement 
measures  aimed  at  prevention  and  victim  protection.  Despite  a  large  number  of  complaints, 
the  number  of  prosecutions  and  convictions  for  trafficking  remains  low.  The  government 
expressed  its  willingness  to  tackle  the  issue  and  welcomed  cooperation  with  international 
partners, including the EU. 

Macao  has  not  effectively  enforced  freedom  of  association  and  collective  bargaining  as 
enshrined in International Labour Organisation Conventions. Proposed private bills on trade 
unions and  collective  bargaining  have been  rejected  repeatedly  in  the Legislative Assembly. 
While employees are free to take part in trade union activities and industrial action, they are 

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not  protected  from  retaliation. Article  70  of  the  Labour  Relations  Law  allows  employers  to 
terminate  employment  without  just  cause  by  offering  a  modest  amount  of  compensation.  In 
2016,  lawmakers  rejected  the  trade  union  bill  for  the  seventh  time,  even  though  it  received 
more  votes  than  in  the  previous  year.  Many  legislators  cited  Macao’s  underperforming 
economy and ‘bad timing’ as the main reasons for rejecting the bill. 

Robust  anti-corruption  measures  continued  to  be  implemented  even  though  the  year  saw 
some  high-profile  cases.  The  Commission  Against  Corruption  (CCAC)  criticised  the 
government  for  breaching  the  law  in  a  land  swap  deal  involving  a  local  factory.  It  said  the 
deal was invalid and called for the site to be listed and protected.  

Economic developments 

Macao’s  economy  has  experienced  a  significant  downturn  over  recent  years  as  the  casino 
industry  was  hit  by  the  slowing  Chinese  economy  and  the  anti-corruption  campaign  on  the 
mainland.  Macao’s  GDP  plummeted  by  20.3 %1  in  real  terms  in  2015.  The  contraction 
gradually  eased  in  the  third  quarter  of  2016,  when  GDP  growth  rebounded  by  4 %  in  real 
terms,  registering  the  first  positive  quarterly  growth  in  two  years.  Overall,  the  economy 
shrank by 2.1% in real terms in 2016. Gaming revenue rebounded in the second half of 2016, 
after more than two years of continuous decline. Total gaming revenue fell by just 3.3 % to 
MOP 230.8  billion  in  2016,  a  significant  improvement  on  the  double-digit  drop  in  2015. 
Tourism steadily recovered thanks to two new casino resorts, Wynn Palace and the Parisian. 
Total visitor arrivals edged up by 0.8 % to 30.9 million in 2016. Mainland China remained the 
most important source of tourists for Macao, contributing to two-thirds of visitor arrivals in 
the first 11 months of 2016, followed by Hong Kong (21 %), Taiwan (3.5 %), Korea (2.1 %) 
and Japan (1 %).   

To reduce over-reliance on the casino industry, the government launched its first ever Five-
Year  Development  Plan  (2016-2020)  in  September,  setting  out  comprehensive  development 
targets  to  improve  livelihoods  and  achieve  economic  diversification.  It  aims  to  turn  Macao 
into an international hub for tourism and leisure and create a commercial and trade platform 
between  China  and  Portuguese-speaking  countries  (the  ‘Centre  and  Platform’  policies).  The 
plan  also  includes  increased  efforts  to  achieve  moderate  economic  diversification  and 
strengthen  regional  cooperation,  particularly  with  Guangdong  province,  as  stipulated  in 
China’s 13th Five-Year Plan (2016-2020).     

The Five-Year Development Plan proposes specific policy measures to reduce the economy’s 
reliance  on  gaming  in  the  long  term.  These  include:  capping  gaming  tables  at  an  annual 
growth rate of 3 % for 10 years starting in 2013; increasing the share of non-gaming elements 
from  6.6 %  of  total  gaming-related  revenue  at  present  to  9 %  by  2020;  raising  employment 

1   Unless otherwise stated, economic indicators pertaining to the Macao economy have been sourced from the Statistics and 

Census Service of the Macao SAR government. 

. 

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participation in retail, hotel and manufacturing sectors; strengthening financial services; and 
setting up the Macao SAR Development Fund (essentially a sovereign wealth fund) by 2019.  

The  Plan  also  covers  a  range  of  initiatives  to  promote  creative  industries,  infrastructure 
development, smart city development, environmental protection and to strengthen healthcare, 
education  and  housing.  It  contains  a  reference  to  the  ‘One  Belt,  One  Road’  initiative  and 
Macao’s  possible  role  in  this,  particularly  in  terms  of  the  maritime  route  and  as  a  business 
facilitator  for  Portuguese-speaking  countries.  Following  the  revision  of  its  maritime 
boundaries  in  2015,  Macao  is  seeking  to  promote  its  maritime  economy  and  maximise  its 
contribution to the ‘One Belt, One Road’ initiative. 

In  November,  Chief  Executive  Fernando  Chui  presented  his  2017  policy  address  to  the 
Legislative  Assembly.  The  government  pledged  to  encourage  operators  to  build  boutique 
hotels and shopping malls, roll out an action plan to help local SMEs take part in large-scale 
exhibitions  and  expand  the  Young  Enterprise  scheme  and  offer  quality  training  to  young 
people.  

The  policy  address  also  contained  a  set  of  welfare  measures  and  subsidies,  including  the 
popular cash handouts to Macao residents for the tenth year in a row. 

Macao’s fiscal position remained strong with deep reserves. Its fiscal reserves were estimated 
to reach MOP 468 billion, equivalent to 130% of GDP. This is extremely high for a territory 
with  less  than  half  a  million  people  (excluding  foreign  workers).  Macao  has  consistently 
recorded a fiscal surplus despite a significant drop in gaming taxes in 2015 and 2016.   

Macao continues to suffer from an acute labour shortage. The unemployment rate has been at 
or  below  2 %  for  the  past  four  years,  with  1.9 %  recorded  in  2016.  Its  economy  therefore 
relies  heavily  on  foreign  workers  and  professionals.  Despite  the  economic  downturn,  there 
were  over  180 000  non-resident  workers  in  2016,  representing  45 %  of  the  working 
population.  Imported  labour  has  become  a  sensitive  political  issue.  In  November,  the 
Secretary for Economy and Finance, Lionel Leong, reiterated in the Legislative Assembly that 
the Macao government would secure employment opportunities for local residents and would 
roll  out  a  mechanism  for  non-resident  workers  to  leave  the  Macao  SAR.  Legislators 
complained  about  the  abuse  of  the  labour  import  scheme,  which  resulted  in  job  losses  and 
stagnant  wages  for  local  workers  as  well  as  slower  career  progression  for  some  managers. 
However, businesses  have repeatedly complained about the lack of suitable professionals to 
handle their expanding operations. 

China’s  13th Five-Year  Plan  contained  a  dedicated  chapter  on  Macao  (together  with  Hong 
Kong)  and  emphasised  deeper  cooperation  between  the  mainland  and  Hong  Kong/Macao. 
China  expressed  support  for  developing  cooperation  platforms  for  Guangdong-Hong  Kong–
Macao as well as for Hong Kong and Macao to play an important role in the Pan-Pearl River 
Delta region and in developing the Guangdong-Hong Kong-Macao Big Bay Area. In March, 
the  State  Council  issued  guidelines  on  promoting  cooperation  within  the  Pan-Pearl  River 
Delta region, which includes 9 provincial regions — Fujian, Jiangxi, Hunan, Guangdong, the 

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Guangxi Zhuang autonomous region, Hainan, Sichuan, Guizhou and Yunnan — as well as the 
Hong  Kong  and  Macao  Special  Administrative  Regions  (the  ‘9+2’).  China’s  central 
government  sees  the  region  as  a  pioneer  in  reform,  a  key  area  for  the  mainland  to  secure 
cooperation  opportunities  with  Hong  Kong  and  Macao  as  well  as  a  crucial  area  for  making 
progress on the One Belt, One Road Initiative. 

As a result, Macao continued to promote further integration with the Pearl River Delta region 
and sought to establish a niche position for itself as a bridge between China and Portuguese-
speaking countries under the Forum for Economic and Trade Cooperation. Besides the Pearl 
River  Delta  region,  the  Macao  Chief  Executive’s  policy  address  also  mentioned  greater 
cooperation with other Chinese provinces/municipalities such as Jiangsu, Beijing and Tianjin, 
and  with  the  traditional  industrial  regions  in  the  mid-western  and  north-eastern  regions  of 
China. 

In  October, Macao  hosted  the  Fifth  Ministerial  Conference  of  the  Forum  for  Economic  and 
Trade  Cooperation  between  China  and  Portuguese-speaking  Countries.  The  Chinese  Prime 
Minister Li Keqiang attended the forum, which aimed to boost China’s economic relationship 
with the developing world and to chart a new course for Macao. Mr Li’s visit was interpreted 
not only as offering clear support for Macao’s economic policies, but also as an expression of 
overall satisfaction with the Macao SAR, including its political development.  He announced 
a further 19 measures designed to transform Macao’s economy, which include: 

  China’s central government supporting Macao in developing an RMB clearing centre 
between China and Portuguese-speaking countries and helping it to develop financial 
leasing, e-commerce and export credit insurance.  

  A  Sino-Portuguese  joint  fund  with  headquarters  in  Macao  for  cooperation  projects 

between large mainland e-businesses and non-banking payment organisations.  

  China’s  central  government  continuing  to  support  Macao  in  areas  like  Chinese 
medicine, smart city development, tourism and its involvement with the neighbouring 
city of Hengqin.  

  China  also  helping  Macao  establish  cultural  exchange  centres,  bilingual  training 

centres and a youth innovation centre for exchanges with these countries.  

Hong  Kong  and  Macao  initiated  talks  on  their  Closer  Economic  Partnership  Arrangement 
(Hong Kong-Macao CEPA) in mid-July and started negotiations in October. The Hong Kong-
Macao CEPA will cover trade in goods, trade in services and investment. However, it will not 
cover the free movement of people across the border for education or work. After the Hong 
Kong-Macao  CEPA  has  been  signed,  China,  Hong  Kong  and  Macao  may  build  upon  their 
CEPAs to establish a new, common platform to advance further liberalisation and facilitation 
of  trade  and  investment  in  the  ‘Greater  China’  region  —  the  so-called  Guangdong-Hong 
Kong-Macao Big Bay Area mentioned in the 13th Five-Year Plan. 

Macao  is  still  vulnerable  to  money  laundering  as  the  casino  industry  provides  plenty  of 
avenues  for  illegal  money  coming  from  the  mainland.  To  counter  this,  Macao’s  casino 

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regulator  (the  Gaming  Inspection  and  Coordination  Bureau,  also  known  by  its  Portuguese 
acronym DICJ) revised its anti-money laundering rules in May.2 ‘Instruction 1/2016’ requires 
casinos  and  junket  operators  to  engage  in  more  detailed  anti-money  laundering  procedures. 
The new set of rules more than doubles the number of provisions. It stipulates that casino and 
junket operators  must  review the money laundering risks involved  in their activities at least 
every  two  years  and  introduce  ‘effective  measures’  to  tackle  such  risks.  The  rules  require 
casino  and  junket  operators  to  ‘identify  and  closely  monitor  transactions’  involving 
‘politically  exposed  persons'.  Instruction  1/2016  also  expressly  forbids  casino  and  junket 
operators  to  conduct  business  with  people  using  aliases  or  under  cover  of  anonymity. 
Nevertheless,  it  has  been  alleged  that  even  though  Macao  has  made  considerable  efforts  to 
develop  an  anti-money  laundering  framework  that  meets  international  standards,  its  junkets 
still show vulnerabilities. In 2016, the Financial Intelligence Office of the Macao SAR signed 
memoranda of understanding/cooperation agreements with Bangladesh, Canada and Israel. 

In 2016, Macao joined the ‘inclusive framework on Base Erosion and Profit Shifting (BEPS)’ 
of  countries  and  jurisdictions  that  have  pledged  to  collaborate  on  the  implementation  of 
measures to combat multinational tax avoidance as part of the OECD/G20 BEPS framework. 
Macao has therefore committed itself to: 

  adopting minimum standards on treaty shopping; 
 
 
 

implementing country-by-country reporting for transfer pricing; 
limiting the benefits of its intellectual property or other preferential tax regimes; 
fully implementing the mutual agreement procedure in their tax treaties.  

This  will  be a significant  factor in  the process leading to  the establishment of  an  EU list of 
non-cooperative jurisdictions, which will be drawn up in 2017. Macao successfully passed the 
Phase  I  and  Phase  II  peer  reviews  conducted  by  the  Global  Forum  on  Transparency  and 
Exchange  of  Information  for  Tax  Purposes  in  2011  and  2013  respectively,  confirming  that 
both its legal framework and current operations meet internationally agreed standards on the 
exchange of tax information. To date, Macao has concluded tax treaties with 20 jurisdictions, 
5  of  which  are  double  tax  agreements  and  15  of  which  are  Tax  Information  Exchange 
Agreements. 

In  December,  Macao  and  the  United  States  signed  an  intergovernmental  agreement  (IGA), 
which aims to help financial institutions in the Macao SAR comply with the Foreign Account 
Tax Compliance Act (FATCA). The Monetary Authority of Macao stated that the IGA would 
reduce  the  reporting  burden  and  help  its  financial  institutions  comply  with  FATCA  as  it 
covers exemptions for financial institutions or products with a low risk of tax evasion by US 
taxpayers. 

EU-Macao bilateral relations in 2016 

2   The  previous  anti-money  laundering  instruction  had  been  issued  in  2006.  The  new  rules  (Instruction  No 1/2016)  are 

available on the official website of the DICJ in Chinese and Portuguese. 

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As a result of the contraction in Macao’s economy, EU-Macao bilateral trade fell significantly 
in  2016.  EU  exports  to  Macao  dropped  by  20.2%  to  EUR  603  million  while  imports  from 
Macao declined by 6.5% to EUR 86 million. The EU has been recording trade surpluses with 
Macao since 2009, reaching EUR 516 million in 2016. Major EU exports included high-end 
leather  goods,  fashion,  watches  and  jewellery,  food  and  beverages  and  motor  vehicles.  In 
2016, the EU was still Macao’s second largest source of imports after mainland China. 

However, the fluctuations in Macao’s economy in 2016 had an impact on the EU’s trade and 
investment  interests  and  on  the  profits  of  European  companies.  The  EU  and  its  business 
community are keen to work with the Macao government to diversify its economy, improve 
the  sustainability  of  its  economic  development  and  promote  bilateral  trade  and  investment 
flows. EU businesses could play an important role by providing expertise and services in the 
many ongoing infrastructure projects and expansion plans of private investors.   

The  21st  EU-Macao  Joint  Committee  meeting  was  held  in  Brussels  on  5  December  2016. 
During  the  meeting,  Macao  informed  the  EU  of  the  recent  publication  of  its  Five-Year 
Development  Plan  (2016-2020),  which  sets  out  the  blueprint  for  its  economic  and  social 
development.  The  EU  and  Macao  exchanged  views  on  the  development  of  their  taxation 
policies. The EU welcomed Macao’s commitment to implementing the automatic exchange of 
information in 2018 and encouraged it to take appropriate steps for the effective and timely 
activation of this exchange with the EU and other partners, so as to fulfil its commitment in 
accordance with OECD standards. The EU also welcomed Macao’s recent decision to join the 
Inclusive  Framework  on  BEPS.  It  encouraged  Macao  to  pursue  its  efforts  towards  a  fully 
open,  transparent  and  non-discriminatory  government  procurement  framework  in  line  with 
international  standards.  Both  sides  welcomed  the  progress  made  by  the  Third  Macao-EU 
Cooperation Programme in the Legal Field, whose aim is to promote the modernisation and 
development of Macao’s legal system. Both sides emphasised that the EU-Macao co-funding 
mechanism will encourage Macao researchers to take part in the EU’s Horizon 2020 research 
and innovation programme. The two sides agreed to explore cooperation on the environment 
and  green  technology,  particularly  in  the  Macao  International  Environmental  Cooperation 
Forum and Exhibition. The EU and Macao agreed that continuing the training programme in 
conference interpretation and translation in Chinese and Portuguese would meet the EU’s and 
Macao’s  needs  for  qualified  interpreters  in  both  languages.  The  EU  also  noted  Macao’s 
efforts  to  combat  human  trafficking.  Both  sides  looked  forward  to  strengthening  their 
cooperation in this area following the joint workshop on trafficking in human beings held in 
January. 

Given  the  increasing  role  of  European  businesses  operating  in  Macao,  the  EU  and  Macao 
agreed  that  direct  exchanges  between  these  businesses  and  the  Macao  SAR  government 
would  be  further  strengthened  by  establishing  a  regular  dialogue  between  the  European 
business  community,  represented  by  the  Macao  European  Chamber  of  Commerce,  and  the 
Macao authorities. European companies will be able to use this platform to communicate with 
the  government  on  business  environment  and  regulatory  issues.  The  platform  could  also 

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provide  Macao’s  authorities  with  a  forum  to  seek  views  on  relevant  policies  as  and  when 
required. The ultimate objective would be to contribute to Macao’s economic diversification 
and long-term competitiveness. 

As Macao suffers from acute shortages of labour and skilled managers, European companies 
rely  heavily  on  expatriate  staff  and  foreign  workers.  Obtaining  work  permits  for  them  has 
proven difficult. The EU is willing to work with the Macao authorities and with the European 
business  community  to  help  identify  areas  of  economic  activity  where  the  situation  is 
particularly  acute.  Giving  qualified  professionals  easier  access  to  Macao’s  labour  market 
would help boost its competitiveness.    

As  part  of  its  agenda  for  fair  taxation  at  global  level,  the  EU  pursued  the  work  towards  a 
common EU list of non-cooperative jurisdictions. During its preparatory work a "Scoreboard" 
was  compiled  based  on  a  pre-assessment  of  all  third  countries.  Macao  was  flagged  on  the 
transparency  and  the  preferential  Corporate  Income  Tax  (CIT)  regime  risk  indicators.  The 
Scoreboard is not a preliminary EU list and does not entail any judgement of third countries. 

The  Macao  European  Chamber  of  Commerce  (MECC)3  and  the  European  Chamber  of 
Commerce in Hong Kong jointly coordinated the large European participation in the Macao 
International  Environmental  Cooperation  Forum  &  Exhibition  in  March  and  the  Macao 
International  Trade  and  Investment  Fair  in  October.  The  MECC’s  role  and  relevance  are 
expected to grow once the EU-Macao business-to-government dialogue has been set up. 

The European Union Academic Programme, managed by a consortium led by the University 
of Macao, organised many new activities such as hosting visiting speakers, seminars, research 
and academic exchanges, the EU-themed short film challenge, a regular radio show on EU-
related topics and a "Model EU" competition. 

In the future, the EU will continue to deepen its relationship with Macao, increasing economic 
and trade links, improving cooperation with business and civil society and promoting mobility 
and exchanges with the people of Macao. Priorities include: 

  greater cooperation to diversify Macao’s economy; 
  seizing opportunities arising from infrastructure projects and public procurement; 
  maximising  the  potential  benefits  of  the  Closer  Economic  Partnership  Arrangement 
between  Macao  and  mainland  China  to  the  benefit  of  both  local  and  European 
companies established in Macao; 

  cooperating  on  legal  and  regulatory  affairs,  research  and  innovation,  and  continuing 

cooperation on trafficking in human beings. 

3   The MECC is a hybrid chamber that has both direct company members and members from the national chambers of EU 
countries. It currently includes the British Business Association of Macao, the France Macau Business Association, the 
German  Macau  Business  Association,  the  Irish  Chamber  of  Commerce  in  Macau,  the  Macao-Romania  Chamber  of 
Commerce and the Portuguese-Chinese Chamber of Commerce and Industry. 

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