Macau, Macao

🇲🇴 Macau, also spelled Macao and officially the Macao Special Administrative Region of the People's Republic of China, is a city and special administrative region of the People's Republic of China in the western Pearl River Delta by the South China Sea. Macau is the most densely populated region in the world. Macau is a former colony of the Portuguese Empire, after Ming China leased the territory as a trading post in 1557.

Economy Macau has a capitalist service economy largely based on casino gaming and tourism. It is the world's 83rd largest economy, with a nominal GDP of approximately MOP433 billion (US$53.9 billion). Although Macau has one of the highest per capita GDPs, the territory also has a high level of wealth disparity. Macau's gaming industry is the largest in the world, generating over MOP195 billion (US$24 billion) in revenue and about seven times larger than that of Las Vegas. Macau's gambling revenue was $37 billion in 2018.

The regional economy is heavily reliant on casino gaming. The vast majority of government funding (79.6 percent of total tax revenue) comes from gaming. Gambling as a share of GDP peaked in 2013 at over 60 percent, and continues to account for half of total economic output. The vast majority of casino patrons are tourists from mainland China, making up 68 percent of all visitors. Casino gaming is illegal in both the mainland and Hong Kong, giving Macau a legal monopoly on the industry in China.

Casino gambling was legalised in 1962 and the gaming industry initially operated under a government-licensed monopoly granted to the Sociedade de Turismo e Diversões de Macau. The Sands Macao, Wynn Macau, MGM Macau, and Venetian Macau were all opened during the first decade after liberalisation of casino concessions. Casinos employ about 24 percent of the total workforce in the region.

Export-oriented manufacturing previously contributed to a much larger share of economic output, peaking at 37 percent of GDP in 1985 and falling to less than 1 percent in 2017. The bulk of these exports were cotton textiles and apparel, but also included toys and electronics. At the transfer of sovereignty in 1999, manufacturing, financial services, construction and real estate, and gaming were the four largest sectors of the economy. Macau's shift to an economic model entirely dependent on gaming caused concern over its overexposure to a single sector, prompting the regional government to attempt re-diversifying its economy.

The government traditionally had a non-interventionist role in the economy and taxes corporations at very low rates. Post-handover administrations have generally been more involved in enhancing social welfare to counter the cyclical nature of the gaming industry. Economic growth has been attributed in large part to the high number of mainlander visits to Macau, and the central government exercises a role in guiding casino business growth through its control of the flow of tourists. The Closer Economic Partnership Arrangement formalized a policy of free trade between Macau and mainland China, with each jurisdiction pledging to remove remaining obstacles to trade and cross-boundary investment.

Due to a lack of available land for farming, agriculture is not significant in the economy. Food is exclusively imported to Macau and almost all foreign goods are trans-shipped through Hong Kong.