Guidance

Doing business in Macao: Macao trade and export guide

Updated 8 June 2015

Export opportunities and advice

Find more export advice and explore opportunities overseas on great.gov.uk.

1. Macao export overview

Macao is a Special Administrative Region (SAR) of the People’s Republic of China with a high degree of autonomy.

It’s a small, open economy based in a physically small area, with little arable land and limited natural resources. The economy is reliant on the services industry which is dominated by gaming and tourism.

Contact a Department for Business and Trade (DBT) Macao export adviser for a free consultation if you’re interested in exporting to Macao.

Contact UK Export Finance (UKEF) about trade finance and insurance cover for UK companies. You can also check the current UKEF cover position for Macao.

A number of UK businesses are active in Macao in a range of sectors. They include HSBC, Standard Chartered Bank, Cable & Wireless, Arup, NCC Education, Manchester United and Next.

Benefits for UK businesses exporting to Macao include:

• strong economy despite a recent slowdown
• over £10 billion in construction and engineering contracts available
• emerging opportunities in retail, creative industries and food and drink
• strong education links
• free port status so no import duties

Strengths of the Macao market include:

• large foreign exchanges reserves
• low taxation
• few exchange controls or foreign currency regulations
• free trade economic system

2. Challenges

Macao has to import the majority of the necessary goods and services to deliver major projects. As anticipated projects will coincide with huge investment in Hong Kong there will be competition for resources.

Newcomers to the market will need to work hard to make the necessary contacts.

3. Growth potential

3.1 Economic growth

Macau’s economy which is based largely on gambling and tourism recorded a contraction in the first quarter of 2015. It shrunk 24.5% year on year mainly caused by a 39.7% decline in gaming revenue. This was the biggest decline since quarterly numbers became available in 2002.

The Macao government does not issue Growth Domestic Product (GDP) forecasts. However, forecasts from academic and commercial sources all report a fall ranging from 6 to 14.7%.

Macao is the only place in Greater China where it’s legal to operate a casino. Gambling and tourism became the largest sectors of Macao’s economy following the liberalisation of the Macao gambling industry in 2002. Gambling and tourism account for:

• 85% of GDP
• over 70% of total employment

The fall in gross gaming revenue for the 12th consecutive month was the result of:

• an anti-corruption campaign in China which sharply reduced VIP gambling spending
• a slowdown of the Chinese economy
• tighter visa policies
• a smoking ban on gaming floors

New casino developments on the Cotai Strip will support growth in 2015 to 2020.

The Macau government has been pushing casino operators to diversify into other non-gaming businesses. On the current downward gaming trend in Macau, strong growth in the non-gaming revenue is expected.

Macao has relatively large foreign exchange reserves at USD 17.19 billion (April 2015). New opportunities may emerge for UK companies as the Macao Monetary Authority looks to get better return on its investments.

3.2 Free trade agreements (FTA)

Macau has a Closer Economic Partnership Agreement (CEPA) with China. The original agreement was expanded in 2014 to include legal, financial, health, tourism and the sports services sectors.

4. UK and Macao trade

UK goods exported to Macao were just over £53 million in 2014. This does not include trade via Hong Kong.

Top 10 UK exports in 2014:

• electrical machinery and equipment, television and sound equipment
• beverages, spirits and vinegar
• boilers, machinery and mechanical appliances
• aircraft
• ships and floating structures
• vehicles
• works of art and antiques
• optical, photographic, cinematographic, medical instruments and measuring apparatus
• precious and semi-precious stones, precious metals, imitation jewellery and coins
• clothing and accessories

5. Opportunities for UK businesses in Macao

Department for Business and Trade (DBT) provides free international export sales leads from its worldwide network. Search for export opportunities.

5.1 Macao resorts

Over £10 billion in contracts are available for projects across 6 major integrated leisure and tourism resorts up to 2018.

This is a High Value Opportunity (HVO). It includes opportunities for UK companies across the project lifecycle in:

• construction
• design
• project management
• engineering
• entertainment
• retail

Each leisure resort has to differentiate itself around:

• accommodation
• entertainment
• gambling

This offers opportunities to creative UK companies who can design and deliver an attraction.

There are opportunities for UK contractors offering the necessary expertise through:

• joint ventures
• tier 1 or 2 supplier contracts

UK companies who have outsourced their production to China, could be in a good position to supply products at competitive prices.

Contact the Department for Business and Trade (DBT) team in Hong Kong at commercial@bcg.org.hk for more information on this HVO.

5.2 Retail

There are significant emerging opportunities for UK firms in retail, creative industries and food and beverages. These opportunities relate to the leisure resorts and their 30 million visitors.

The recent relaxation of regulations on the import of British beef and lamb lamb and huge demand for fresh pork will open up additional opportunities.

Contact the Department for Business and Trade (DBT) team in Hong Kong at commercial@bcg.org.hk for more information on retail opportunities.

5.3 Education

The University of Macao has research links with Cambridge and Edinburgh in Chinese medicine and is keen to develop more.

There is also an opportunity to identify potential partnerships between the Macao Gaming Institute and the UK gaming industry and relevant universities.

There are other opportunities in the provision of:

• training
• leadership and executive programmes
• qualifications assessment

Contact the Department for Business and Trade (DBT) team in Hong Kong at commercial@bcg.org.hk for more information on education opportunities.

6. Start-up considerations

You will need a local business partner (such as an agent or distributor) to export successfully to Macao. Development of a successful relationship will require a visit to the market.

Licensing or franchising may also be viable options for some products and services.

7. Legal considerations

Macao has its own judicial system with a high court. The legal framework is based largely on Portuguese law. Property rights and commercial contracts are secure.

UK companies entering into legal agreements in Macao should undertake professional advice. Contact the Department for Business and Trade (DBT) team in Hong Kong for advice and assistance on legal services.

7.1 Standards and technical regulations

The Macao Ministry of Economic Services has responsibility for regulations.

Labeling regulations require all prepackaged food to have the following information in either Portuguese and/or Chinese.

• product name
• manufacturer’s name and address
• list of Ingredients
• additives
• alcohol content
• weight and volume of the product (in metric units)

The Macao government has now approved the import of UK beef (boneless) and lamb.

7.2 Intellectual property (IP)

Macao has signed the main international treaties relating to intellectual property.

The Intellectual Property Rights Department of the Macao Customs Service has responsibility for IP. Copyright law has been extended to cover the Internet and digital technology.

8. Tax and customs considerations

8.1 Tax

The Financial Services Bureau has responsibility for Macao’s tax system.

There are no sales taxes or Value Added Tax (VAT) in Macau.

Direct taxes include:

• industrial tax
• complementary (profits) tax
• professional tax
• property tax

Indirect taxes include:

• excise tax
• consumption tax
• tourism tax
• stamp duty

8.2 Excise tax

The Licensing and Consumption Tax Division of Macao Economic Services has responsibility for excise duty. Excise duty is levied on tobacco, spirits, petroleum, lubricants and imported vehicles.

Certain alcohol beverages are subject to an ad valorem tax based on their Cost, Insurance and Freight (CIF) price in Macao. Other products are subject to fixed rates of consumption.

The tax is based on the alcohol strength of the product, with the exception of rice wine.

8.3 Customs

Macao has no import tariffs.

The Macao Customs Service has responsibility for customs procedures.

9. Business behaviour

The official languages of Macao are Chinese (Cantonese dialect) and Portuguese. English is most commonly used when conducting business.

10. Entry requirements

UK passport holders do not require a visa to enter Macao as a visitor and will normally be allowed to stay for up to 6 months.

10.1 Travel advice

If you’re travelling to Macao for business, check the Foreign & Commonwealth (FCO) travel advice beforehand.

11. Contact

Contact the Department for Business and Trade (DBT) team in Hong Kong for more information and advice on opportunities for doing business in Macao.