In the four years after its return, Macao has carried out a series of effective reforms in political, economic, social and cultural sectors, based on the Basic Law of the Macao Special Administrative Region (SAR) according to the will of Macao residents. Within the framework of "one country, two systems," the Macao SAR Government has oriented its economy with tourism and gaming as the backbone and reasonably developed other industries. The Central Government has given full support to the development of Macao. At the same time, the official trade cooperation between Macao and the mainland has expanded from coastal provinces, like Guangdong and Fujian, to inland areas like Chongqing Municipality and the Inner Mongolia Autonomous Region.

Macao's interactions with other countries and regions throughout the world have been fruitful. Authorized and directed by the Central Government, Macao has signed over 30 agreements on civil aviation with other countries and regions, and 41 countries and regions have granted free-of-visa status to Macao. Moreover, Macao has signed agreements with Portugal on investment protection and mutual judicial assistance.

Encouraging growth achieved. The GDP of Macao in 2003 reached MOP63.37 billion, an increase of 15.6 percent year on year. The per-capita GDP came to nearly MOP142, 638. Macao's economic growth is mainly driven by the flourishing gaming, construction and export sectors. The gross revenue of the gaming industry in 2003 is 29 percent higher than that in 2002, making a prominent contribution to the entire economic growth. In the area of fixed assets investment, because of the launch of a large number of construction projects invested privately or by the government, the total investment rose 74.7 percent on an annual basis.

The investment in equipments went up 10.2 percent. Money spent on multi-purpose buildings and equipments soared 40.5 percent in real terms. The exports increased 9.4 percent in 2003, amid increasing sales of commodities to the United States and the European Union. The imports in 2003 increased 11.1 percent. Additionally, the consumer price index, which is used to measure the general price changes, increased 0.9 percent, showing that the general price level of Macao stopped falling and began to rebound in 2003.

Closer Economic Partnership Arrangement reached between mainland and Macao. On October 17, 2003, Vice Minister of Commerce An Min and Macao's Secretary for Economy and Finance Francis Tam Pak Yuen signed the Closer Economic Partnership Arrangement between the mainland and Macao on behalf of the Central Government and the Macao SAR Government.Vice President Zeng Qinghong and Chief Executive of the Macao SAR Government Edmund Ho Hau Wah attended the signing ceremony. According to the pact, 273 categories of goods made in Macao began to enjoy zero tariffs when entering the mainland market on January 1, 2004.

The agreement covers trade in goods, liberalization of trade in services and trade and investment facilitation. Regarding trade in goods, the mainland applied zero tariffs to exports from Macao in 273 product codes, including some chemical products, paper articles, textile and clothing, jewelries, electrical and electronic products, pharmaceutical products and food and beverages, effective from January 1, 2004. Zero tariffs for other Macao-made products will be given no later than January 1, 2006. In the area of trade in services, the mainland opened 18 sectors to Macao, including management consulting, convention and exhibition, advertising, accounting and legal services. By doing so, the mainland honored its WTO membership commitments to Macao ahead of schedule.

The Central Government also lifted restrictions on Macao businesses' equity investment in many trades in the mainland, allowed exclusive ownership to them, lowered requirements on their minimum registered capital and qualifications, and relaxed geographic restrictions and limitations on their business scope. The mainland and Macao reached consensus on strengthening cooperation in facilitating trade and investment, customs clearance, quarantine and inspection of commodities, quality assurance and food safety, cooperation between small and medium-sized enterprises, e-commerce, legal transparency, and in other fields. At the same time, both sides affirmed concrete cooperation in financial and tourist areas and agreed to speed up the consultation on mutual acknowledgement of professional qualifications recognized in each other.

Macao-Zhuhai cross-border industrial zone launched. The foundation laying ceremony of the Macao-Zhuhai Cross-Border Industrial Zone was held in Macao on December 9, 2003, marking a new period for economic cooperation between Macao and Guangdong Province. The inauguration was jointly presided over by Macao SAR Chief Executive Edmund Ho Hau Wah and Governor of Guangdong Huang Huahua. Located on the seashore in the border area of Macao and Zhuhai, the first phase of the industrial park will cover 0.4 square km, of which 0.11 square km are in Macao and 0.29 square km in Zhuhai. According to its planning, the industrial park will make full use of Macao's status as a special administrative region and a free port and Zhuhai's advantages in manufacturing, talented personnel, technology and low production cost, giving priority to developing export-oriented textile and garment processing industry and attracting fashion designing, logistics, exhibition and other relevant industries. This is expected to help the park become a regional fashion center, and a platform for cooperation between Guangdong Province and Macao and between Zhuhai and Macao.

Tourists to Macao reached new high. Figures of the Statistics and Census Service of Macao SAR Government show that tourist visits to the region totaled 11.88 million in 2003, 3 percent higher than in 2002 despite the setbacks due to SARS. Because some mainland residents traveled to Macao individually, the number of group travels to Macao dropped by 27 percent compared to 2002. Per-capita tourist spending in 2003 was 1,518 yuan, up 4 percent over 2002. Mainlanders led tourists from other countries and regions in this regard, spending 2,847 yuan per capita. The daily spending of tourists, 1,223 yuan, almost stood at that of 2002. Mainland tourists again topped the list, at 1,831 yuan.