help mainland enterprises to establish in portuguese speaking countries. for the financial services which are pertinent in industrial transfer involving china and portuguese speaking countries, banks of macau can be of help. all along, mainland capitals and portuguese capitals are major players in the macao banking sector. mainland capitals operating in the macao banking sector come from mega banks of the mainland. they have a network with wide coverage. at the same time, portuguese capitals operating in macao banking sector come from banking conglomerates which have outlets in most of the portuguese speaking countries. these china and portugal funded banks have a long record of communication, interaction and cooperation in macao. they can effectively solve or assist in solving possible financial services problems arising from the process of cooperation in industrial transfer between china and portuguese speaking countries. as a matter of fact, the process may bring in motivation and initiation to stimulate financial innovation of macao banks and mainland banks. based on the above analysis, retrospection and experience of macao, i have the following observations : 1 ) for an economy which has an immature, underdeveloped and incomplete financial market, or when the economy is at its initial stage of development, the function of financial institutions is of utmost importance. thus, the services provided by financial institutions should satisfy the needs arising from economic development, with the ultimate goal of achieving a hand - in - hand growth through interactions. 2 ) when an economy has developed to a certain stage, financial services should outpace economic development to play the role of navigator for further burgeoning of the economy. at the same time, financial services can serve a function in risk management, providing security for stable development of the economy. 3 ) industrial escalation and transfer provide a wide horizon and more business opportunity for financial innovation. therefore, in the course of accommodation of industrial transfer, a fine financial environment has been created. there is a further need for promoting modern financial system and order in a proactive manner. this will effectively perform the leverage function of rational allocation of resources we expect from a financial system which will actually enhance financial innovation and service quality. 4 ) in the course of economic globalization, cross border industrial transfer will be accelerated. in the process, we should start from cooperation between governments which should be extended to practical and cross border cooperation between financial institutions. such cooperation helps financial industry to grow which in turn prompts industrial escalation and transfer. through the function of financial services cooperation platform, better and more efficient use of resources can be

to revisit the stages of economic development and industrial development of macao in the past 400 - odd years, which is of help in making a conclusion on past experience, uncover its pattern and put forward the views. as we all know, macao is a tiny but open economic entity. at the same time, it is an international city where old and new, western and eastern cultures mix. in the past 400 years of development, macao economy experienced prosperity – recession – recovery – stagnation – recession. recovery came back after return to china and then we experienced high growth rate. simultaneously, its industrial structure also had a mutation in tandem with development. at the moment, after 10 years of fast growth, macao economic structure is facing a new metamorphosis and a need for further diversification. macao port opened in 1535. we can demarcate its economic development into four stages. the first stage was 1535 - 1840. in the 300 years, especially the 100 years from late 16th century to early 17th century, macao was one of the most prosperous trading ports in the far east. it was a hub for marine trade between the east and the west. the second stage was 1841 - 1960. in view of the rise of hong kong, macao was not able to maintain its position as an entrepot in the far east. in 1847, the macao government under portuguese administration announced legalization of gambling. the third stage was 1961 - 1999, the macao economy started its modernization and diversification. first, gaming developed along the natural path to modern tourism services. second, processing and export flourished. under the locomotive effect of tourism services industry and processing and export industry, real estate, construction, banking and insurance burgeoned. thus, the four major pillars of economy gradually came into shape ; they were tourism services industry, processing and export industry, real estate and construction industry, as well as banking and insurance industry. in the ten - odd years from the 80 ’ s to early 90 ’ s, macao ’ s economy, due to the opening - up of china, grew by leaps and bounds. the economy expanded rapidly due to very rapid growth. in 1993, with the popping of economic froth, there was an imbalance in economic structure, macao then experienced recession for a number of years. the fourth stage is 1999 to now. after return to the motherland, the macao economy recovered and started rapid growth again.