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Economy in Macao |
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| Macau's well-to-do economy has remained one of
the most open in the world since its reversion to China in 1999. Apparel
exports and tourism are mainstays of the economy. Although the territory
was hit hard by the 1998 Asian financial crisis and the global downturn in
2001, its economy grew 9.5% in 2002 and 15.6% in 2003. During the first
three quarters of 2004, Macau registered year-on-year GDP increases of
more than 20 percent. A rapid rise in the number of mainland visitors
because of China's easing of restrictions on travel, increased public
works expenditures, and significant investment inflows associated with the
liberalization of Macau's gaming industry drove the recovery. The budget
also returned to surplus in 2002 because of the surge in visitors from
China and a hike in taxes on gambling profits, which generated about 70%
of government revenue. The three companies awarded gambling licenses have
pledged to invest $2.2 billion in the territory, which will boost GDP
growth. Much of Macau's textile industry may move to the mainland as the
Multi-Fiber Agreement is phased out. The territory may have to rely more
on gambling and trade-related services to generate growth. Two new casinos
were opened by new foreign gambling licensees in 2004; development of new
infrastructure and facilities in preparation for Macau's hosting of the
2005 East Asian Games will bolster the construction sector. The Closer
Economic Partnership Agreement (CEPA) between Macau and mainland China
that came into effect on 1 January 2004 offers many Macau-made products
tariff-free access to the mainland, and the range of products covered by
CEPA was to be expanded on 1 January 2005. (CIA The World Fact Book) |
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