Shaking Up Macau: A New Era of Economic Diversification
Macau targets minimizing compulsive gambling issues
Macau's CEO, Sam Hou Fai, has announced four blockbuster projects with a staggering 4.2 billion EUR investment volume, according to iGamingBusiness, aiming to revolutionize the economy of China's Special Administrative Region (SAR). The initiatives aim to lessen its dependence on gambling, which currently contributes around 80% of tax revenues.
Sam views this reliance on gambling as a structural threat. With the growing gambling competition in Asia and international challenges such as the trade war between China and the USA, Macau needs to pivot towards a more diverse economic landscape.
Macau: A SAR with Special Privileges
Since its handover from Portugal in 1999, Macau has enjoyed extensive autonomy under the principle of "One Country, Two Systems." Macau has its own legal system, currency (Pataca), independent customs and tax policy, and political autonomy. This status allows Macau to operate independently, act as a bridge between China and the West, and boasts special privileges within the Greater Bay Area, such as duty-free status as a free port and the special regulations of the Hengqin cooperation zone.
These major projects are being implemented within eight to ten years as part of a long-term strategy for promoting economic diversification, as outlined in the five-year plan and President Xi Jinping's guidelines. The total costs will amount to 38.2 billion Pataca/MOP (approximately 4.2 billion EUR).
Macau's Emerging University City
The largest project is the Macau-Hengqin International Education City, where nearly 200 billion MOP (around 22 billion EUR) has been earmarked. The University of Macau's new campus is already under construction, with operations to begin in 2028. In a second phase, the University of Tourism will also expand into the university city. The complex is being built in the Hengqin cooperation zone, with the goal of training highly qualified professionals, especially for tourism, leisure, and international cooperation.
Building a Cultural and Tourism Hub
120 billion MOP (around 13.2 billion EUR) has been budgeted for the construction of an international cultural and tourism quarter. The project is planned for the land between Macau Peninsula and Taipa, currently underutilized due to insufficient urban planning. The district will house a National Museum, an international center for performing arts, and a museum of modern art. The period for construction is expected to last two to three years.
Chief Executive Sam dreams of Macau becoming a leading cultural hub in Asia and generating international attention for China's cultural heritage. The Chinese national museums could also provide exhibits.
Expanding Macau International Airport
The Macau International Airport is set to undergo a 60 billion MOP (approximately 6.6 billion EUR) expansion. The project involves land reclamation to expand the runway and an upgrade of the airport infrastructure. The goal is to position Macau as an international air traffic hub on the western bank of the Pearl River.
Currently, there are over 50 international flights, and the aim in the future is to strengthen cooperation with the Zhuhai Jinwan Airport, which specializes in domestic flights, to provide logistics and transport solutions for cross-border e-commerce and the high-tech industry in the Greater Bay Area.
Technology Park: Building a Tech Innovation Hub
Plans are underway for a Macau Technology R&D Industrial Park, with the ambition of attracting international research centers. Infrastructure and support mechanisms will be customized to permanently settle high-tech companies in Macau. The government is commissioning external specialist institutions to develop a feasible concept, aiming to integrate the research park into the network of the Greater Bay Area and position Macau as a platform for technological excellence.
The Importance of Hengqin for Macau's Future
In support of these projects, Macau will create new civil and economic legal regulations, designed to provide higher legal certainty, predictability, and stability for investors in the Hengqin cooperation zone. As Macau faces increasing competition in tourism and gaming, such risks and challenges cannot be ignored. - Sam Hou Fai, Chief Executive of Macau
Macau needs to strengthen its connection with neighboring cities and encourage real economic activities in Hengqin, where many companies registered have yet to commence operations. However, six interdisciplinary steering committees and working groups are already in place to facilitate effective cross-departmental project management.
What is the aim of the Macau Technology R&D Industrial Park? To attract international research centers and permanently settle high-technology companies in Macau.
What does Sam Hou Fai, Chief Executive of Macau, believe is necessary for Macau's future in light of increasing competition in tourism and gambling? Strengthening its connection with neighboring cities and encouraging real economic activities in Hengqin.
