Macau economists have jointly released a report analyzing economic growth in cities within the Guangdong-Hong Kong-Macau Greater Bay Area, indicating that Macau should focus on expanding its labor force and prioritize support for tourism and modern service industries to stabilize employment.
The report emphasizes that Macau’s short-term strategy should focus on expanding the labor force while prioritizing support for tourism and modern service industries to stabilize employment.
As noted in the report, “Long-term efforts must enhance human capital through educational investment and institutional reforms, strengthen skills and innovation capabilities, drive industrial digital transformation, and build sustainable growth momentum.” It also highlights that Macau’s economy has historically relied primarily on the gaming and tourism sectors, “fueled by physical capital expansion.”
According to the report by Chan Chi Seng, Kwan Fung, and Joey Sou Pek U of the Macau Society of Social Sciences, Macau constitutes a micro-economy among the cities in the Greater Bay Area, constrained by factors such as land availability, human resources, and market size. Its overall development is highly outward-oriented, with significant reliance on tourism, particularly the gaming industry.
The report notes that Macau’s role within the Greater Bay Area is to serve as a “world tourism and leisure hub,” a China-Portuguese trade platform, and a base for multicultural exchange.”
The research findings indicate that labor has a significantly stronger impact on Macau’s economy than in other Greater Bay Area cities.
In recent years, Macau has achieved rapid economic growth through substantial investments in new tourism infrastructure, resulting in physical capital having a greater effect on its economic expansion compared to its counterparts. However, manufacturing accounts for a very small share of Macau’s economy, and its electricity consumption is lower than that of other cities, leading to a weaker overall impact of electricity use on economic growth.
The report also notes that for small economies like Hong Kong and Macau, after experiencing long-term, substantial investment, the potential for future large-scale investment may become increasingly limited.
Given the persistently low birth rates in Hong Kong and Macau, along with the overall decline in China’s birth population, the growth of the labor supply in the Greater Bay Area is expected to become increasingly sluggish in the future, the report notes.
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