Annexes to JOIN(2016)9 - Macao: annual report 2015 - Main contents
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This page contains a limited version of this dossier in the EU Monitor.
| dossier | JOIN(2016)9 - Macao: annual report 2015. |
|---|---|
| document | JOIN(2016)9  |
| date | April 25, 2016 |
Macao’s integration with the mainland continued apace under their bilateral free trade agreement, the Closer Economic Partnership Arrangement (CEPA). In November, Macao and China signed an agreement on trade in services under which China is to fully or partially open up to the Macao services industry in 153 sectors as from 1 June 2016. China pledged to fully liberalise trade in services with Macao by the end of 2015.
Macao remains vulnerable to money laundering as its massive gaming sector provides avenues for illegal money flowing out of the mainland. To counter this, in August, Macao and China signed a landmark agreement to significantly increase cooperation and improve the implementation of suggestions by the Financial Action Task Force. The new cooperation agreement took the form of a memorandum of understanding between the Macao Monetary Authority (AMCM) and the People’s Bank of China. Observers criticised the agreement for its lack of clarity and detail and questioned the legitimacy of the handing over of sensitive personal information by the AMCM to the Chinese Central Bank. In parallel, Macao’s Financial Intelligence Office (the government office responsible for combating money laundering) signed anti-money laundering cooperation protocols with the U.S. Financial Crimes Enforcement Network, the Russian Federal Financial Monitoring Service, and the Financial Intelligence Unit of the UK. Macao has previously signed protocols of cooperation with Portugal, Hong Kong, South Korea, Indonesia, the Philippines, Thailand, Japan, Malaysia, Singapore, Fiji Islands and Australia.
Macao has responded to the global call for action against tax evasion. In September 2014, the Macao SAR government announced that Macao will adopt the Global Standard for Automatic Exchange of Financial Account Information sponsored by the G20 and developed by the OECD. The authorities stated that Macao will amend its laws with a view to ensuring timely compliance with the new standard, which means that Financial Institutions in Macao will have to launch the Customer Due Diligence procedures as from 1 January 2017 in order to collect the information to be exchanged starting from the following year. Unlike Mainland China, Macao has not however yet confirmed its preparedness to be committed to the comprehensive OECD/Council of Europe Multilateral Convention on Mutual Administrative Assistance in Tax Matters and, as a consequence, has not adhered to the related Common Reporting Standard Multilateral Competent Authority Agreement (CRS – MCAA), to which all the EU Member States are parties. The CRS-MCAA, subject to a rather straightforward procedure of bilateral activation, provides a suitable legal basis for the actual and effective implementation of international cooperation under the OECD standard for Automatic Exchange of Financial Account Information between all its partners, avoiding the need for lengthy bilateral negotiations.
In the environmental field, in 2015 the SAR Government launched a feasibility study for a recycling network. The SAR authorities see regional cooperation as the key to a better environment. Macao has limited space to accommodate recycling network facilities and may have to rely on the mainland to provide land resources.
On external policy, the government continued to boost Macao’s role as a service platform for trade and economic cooperation between China and Portuguese-speaking countries. It supported the operations of the Sino-Portuguese Cooperation Development Fund, and promoted Macao as a bridge for trade and investment between China and Portuguese-speaking countries.
EU-Macao bilateral relations
Notwithstanding the sharp contraction in Macao's economy, EU-Macao bilateral trade increased significantly in 2015. Total trade in goods between the EU and Macao surged by 39.3% and amounted to EUR 851 million. Thanks to the hefty increase of exports of machinery and transport equipment, EU exports to Macao increased by 39.7% to EUR 756 million. Other key export items included luxury goods, food and beverages. EU imports from Macao increased by 36.5% to EUR 96 million in 2015. The EU thus recorded a trade surplus with Macao of EUR 660 million. It remained Macao's second largest supplier after China, accounting for 22% of its imports in 2015. 4
The continued slowing of Macao’s economy in 2015 had an impact on the EU’s trade and investment interests and on the profits of European ventures. The EU and its business community are keen to work with the Macao Government in seeking to diversify its economy, improve the sustainability of its economic development and promote bilateral trade and investment flows.
Bilateral relations between the EU and Macao remained very positive. The 20th meeting of the Joint Committee under the EU-Macao Trade and Cooperation Agreement was held in Macao on 27 November 2015. The two sides reviewed the latest developments in their relationship, took stock of ongoing bilateral cooperation activities and explored new areas for further cooperation. Both sides welcomed the continued cooperation between the Public Administration and Civil Service Bureau of the Macao SAR and the Directorate-General for Interpretation of the European Commission for the training of qualified interpreters for the Macao SAR. 5
During the Joint Committee meeting both sides adopted the third Macao SAR-EU cooperation programme in the legal field. The programme aims to strengthen the Macao SAR’s legal system and improve training for its legal practitioners. 6 Both sides agreed that legal cooperation was an important element of Macao-EU bilateral relations.
To promote the participation of the Macao SAR’s research institutions and researchers in the EU’s large-scale Horizon 2020 programme, Macao announced the setting-up of a matching fund to meet the costs of Macao’s researchers participating in the Horizon 2020 programme. This will mark a new phase in Macao-EU cooperation in research and innovation. Finally, Macao and the EU expressed their intention to continue cooperating and exchanging know-how to combat human trafficking.
The European Union Academic Programme (EUAP), managed by a consortium led by the University of Macau, organised many new activities, such as the hosting of visiting speakers, seminars, and research and academic exchanges. The EUAP’s outreach activities included its first ‘EU photography challenge’, a photo exhibition, the second edition of its EU ‘short-film challenge’, the ‘European Film Cycle’, and a regular radio programme on the European Union. An expanded third edition of the popular ‘Model European Union’ simulation of a European Council meeting took place with the participation of the University of Saint Joseph. For Europe Day, the EUAP organised a series of EU Week events and launched its new booklet on EU-Macao relations.
The Macao European Chamber of Commerce (MECC) 7 and the European Chamber of Commerce in Hong Kong together coordinated European participation in the Macao International Environmental Cooperation Forum & Exhibition in March and the Macao International Trade and Investment Fair in October.
In March 2015, the EU and its Member States supported the ‘Business Leadership to end Human Trafficking and Modern Day Slavery’ conference in Macao. The conference brought together representatives of government, the gaming business and civil society. It raised awareness and explored ways in which businesses can contribute to fighting human trafficking and modern-day slavery.
The EU will continue to work towards deepening its relationship with the Macao SAR, 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; maximising the potential benefits of the Mainland China-Macao Closer Economic Partnership Arrangement (CEPA) for both local and European companies established in Macao; cooperation on legal and regulatory affairs, research and innovation, as well as continued cooperation on the fight against human trafficking.
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(1) Unless otherwise stated, economic indicators pertaining to the Macao economy were sourced from the Statistics and Census Service of the Macao SAR Government.
(2) According to figures released by the Financial Services Bureau of the Macao SAR Government, direct taxes from gaming contributed to 82.5 % of the fiscal revenue in 2014 and 77 % in 2015.
(3) Source: Monetary Authority of Macao
(4) Source: Statistics and Census Service of Macao
(5) A memorandum for a new phase of the five-year training programme for interpretation was signed on 5 November 2015.The interpreter training programme meets the mutual needs of the Macao SAR and the EU for qualified Chinese and Portuguese interpreters.
(6) The first and second legal cooperation programmes were successfully completed in 2007 and 2013 respectively.
(7) The MECC is a hybrid chamber that has both direct company members and members from the national chambers of EU Member States, presently including the British Business Association of Macao, France Macau Business Association, 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.