Macao chief executive highlights people's livelihood in 2016 policy address

Chief executive of the Macao Special Administrative Region (SAR) Chui Sai On said on Tuesday the region is poised to continuously improve people's livelihood and speed up "appropriate diversification" of the local economy.

In a policy address delivered at the Legislative Council, Chui stressed that Macao will grasp the opportunity of China's 13th five-year socioeconomic plan (2016-2020), the "Belt and Road" initiative and China (Shanghai) Pilot Free Trade Zone, while addressing local community's concern for a sustainable economic and social development.

It is the first time that the "Belt and Road" initiative appeared in Macao SAR Chief Executive's Policy Address. The initiative of the Silk Road Economic Belt and the 21st Century Maritime Silk Road, proposed by Chinese President Xi Jinping in 2013, is aimed at reviving the ancient trade routes that span Asia, Africa and Europe.

Chui proposed that the government will give full play to the advantages of Macao's "two systems" and the SAR's role of a bridge and service platform between the Chinese mainland and Portuguese-speaking countries. In addition, the government will strengthen the development of marine economy.

With the internationalization of Chinese currency RMB, Macao will actively promote financial cooperation between Portuguese-speaking countries and Macao as well as the Chinese mainland, said Chui, adding that part of the SAR's fiscal reserves will be used in the "Belt and Road" initiative through the China Development Bank and other cooperation mechanisms.

Chui, who started his second five-year term as Macao's chief executive late last year, said the development of Macao's economy faced challenges, but the economic base was solid with ample financial strength and ability to cope with risks.

"We are full of confidence in Macao's long-run economic outlook, " said Chui.

According to the policy address, the government will implement a prudent fiscal and monetary policy. As of September 2015, the SAR's basic fiscal reserves stood at 131.88 billion patacas (16.52 billion U.S. dollars) and the budget surplus reached 90.3 billion patacas (11.31 billion U.S. dollars) in the previous fiscal year.

The total amount of fiscal reserves is expected to reach 433.56 billion patacas (54.31 billion U.S. dollars) and the foreign exchange reserves will amount to 145.34 billion patacas (18.21 billion U.S. dollars) after the completion of relevant settlement procedures.

Macao's gaming industry continued to adjust with the gross gaming revenue down 35.5 percent to 196.07 billion patacas (24.56 billion U.S. dollars ) in the first ten months of 2015.

Looking to the economic situation in 2016, the external demand will continue to slump as the global economic downside risks remain, Chui said.

Macao will face greater pressure on industrial restructuring, but the non-gaming industry is expected to show a new vigor and the overall economy will maintain steady development, he added.

After the assessment of this year's financial situation, the chief executive proposed to continue the cash-sharing plan next year to grant permanent residents 9,000 patacas per person (1,128. 39 U.S. dollars) and non-permanent residents 5,400 patacas (676.42 U.S. dollars) per person.

Chui also proposed other welfare programs, including offering each eligible Macao permanent resident 10,000 patacas (1,252.63 U. S. dollars) every year and an additional 7,000 patacas (876.84 U.S. dollars) - a special allocation of budget surplus - next year in their personal Provident Fund accounts.

He said the government has increased assistance to the elderly and vulnerable groups by raising pensions to 3,350 patacas and he suggested to raise the minimum subsistence from 3,920 to 4,050 patacas next year.

He also suggested to convert the "short-term food assistance program" to regular service with a daily budget of 40 patacas from the previous 38 patacas, in order to strengthen support for low-income earners.

In addition, Chui proposed to continue the implementation of existing aid to the disabled people, college and postgraduate students.

Official data showed that Macao SAR government will spend about 11.71 billion patacas (1.47 billion U.S. dollars) in subsidies and economic outcome sharing programs.

In the policy address, Chui noted that the SAR government will make efforts to foster new industries and expand support for small- and medium-sized enterprises (SMEs) and young entrepreneurs to accelerate the process of economic diversification.

He said the government will accelerate the development of conventions and exhibitions, cultural and creative activities and traditional Chinese medicine, adding that three statistical indicator systems for new industries will be completed.

The government has launched a series of measures to support the development of cultural industries and through interdepartmental cooperation. "Incentive system for cultural industries" and an "information platform" are about to roll out next year to increase the strength of the emerging industries.

Guangdong-Macao Traditional Chinese Medicine Industrial park will intensify cooperation with key laboratories of the country, and Portuguese-speaking countries will also be expected to join the pilot projects in the field of international registration and service trade, the policy address said.

Chui also noted that the government would continue to implement the "SME Support Program" to increase the maximum guarantee of the Credit Guarantee Scheme for SMEs from 5 million patacas (630,000 U. S. dollars) to 7 million patacas (880,000 U.S. dollars). Corporate liaison will be set up to help invite investment and facilitate capital introduction.

According to the policy address, Macao will launch Internet-themed youth innovation and entrepreneurship program, and seek to extend scope of support for young entrepreneurs to the free trade area in neighboring Guangdong province.