Contribution of Real Estate Industry to Social Development in Macau

Zhong Xiaojian

President, Macau General Association of Real Estate

This year marks the 70th anniversary of the founding of New China and the 20th anniversary of the return to the motherland. Reviewing the development of socialism with Chinese characteristics and the development process since the return, with the strong support of the Central Government and the joint efforts of the Government of the Macau Special Administrative Region (Macau SAR Government), Macau achieves stable political environment, prosperous economy, social harmony, and improvement of people’s living standard that are witnessed by world’s attention. The leaping development has written a new chapter in the successful practice of “one country, two systems.”

Macau’s economic growth has promoted the development of the city. In the 20 years since its return, the real estate industry has played a significant role in the rapid development of Macau’s economy and the improvement of urban functions. It has opened a huge market, for the only 30 square kilometers land in Macau. It can maintain leaping development and is inseparable from the return and Reform and Opening. The society and the economy have fell across the new phase of the fastest development period in history. It has experienced enormous changes in the past 20 years, and residents have rewarded a sense of happiness and gain. Macau’s overall economy has achieved leapfrogging development, with per capita GDP reach to the top in Asia and the second in the world.

Macau ’s GDP, fiscal revenue, and social security expenditures have all continued to increase significantly. Macau ’s residents ’welfare and safeguards have continued to improve, and the unemployment rates have declined year by year. In the World Economic Outlook reported by the International Monetary Fund (IMF) in August 2018, Macau will become the world’s highest per capita GDP city by 2020 and will be the world’s richest region. In recent years, with the return of Macao, the in-depth Reform and Opening of the Mainland, the development of gambling operation rights, the signing and implementation of CEPA, and the launch of the Mainland Hong Kong and Macau Free Travel Policy, Macau’s tourism and real estate industries have achieved rapid growth. Macau’s own market is limited, and it needs to rely on external markets. Macau has a narrow land and wants greater development. It needs to deepen its cooperation with the mainland, in order to boost its development potential and strengthen its development dynamic in regional cooperation.

China has undergone more than 40 years of Reform and Opening and has become the second largest economy in the world. The prosperity of Hong Kong and Macau is increasingly integrated and linked with the Mainland. After Macau’s return, customs clearance at the port was facilitated, and the transportation network was well-developed. It achieved the maximum smooth flow of capital, people, and information between the Mainland and Macau. It extended a huge external market for Macau and accelerated the development of various industries including the real estate industry. The impact of the real estate industry on the economic development of Macau is the home of the country, and housing is the material condition of the home for residents. As long as solving the housing problem, to build a stable and harmonious society. The housing problem has become a big problem in China, including Macau.

Currently, the real estate industry is the second largest pillar industry in Macau, after the gambling industry. Gambling tax has contributed the most to Macau’s fiscal revenue, with contributions exceeding 50% over the years. However, the real estate industry in Macau cannot be underestimated. Taxes related to the real estate industry are an important part of Macau’s fiscal revenue, as early as 2011, the Macau real estate industry had already employed 56,200 people. Therefore, it has a strong ability to boost employment, effectively easing employment pressure in Macau; the real estate industry also has an important role in promoting other industries.

The real estate industry is the foundation of all economic activities investment, and its development reflects the quality of life of Macau residents. In addition, Macau’s real estate industry associations have actively cooperated with various government policies over the years, it has done a lot of accomplishments in housing and urban reconstruction. In order to promote the upgrading of the local housing industry and enhance the competitiveness of the city, Macau actively promulgated relate policies of the real estate industry.

Macau is committed to developing into a smart tourism city to meet the current development trend of the global tourism industry. Therefore, the Macau real estate industry cooperates with the SAR government to actively develop the tourism real estate industry in a more diversified and higher quality direction. The Macau Real Estate Associations, in conjunction with the economic development and land planning formulated by the SAR government, are improving service facilities and the living environment of residents based on improving land utilization. At the same time, Macau is a place where Chinese and Western cultures gather. Macau’s real estate focuses on seeking common ground while reserving differences. The architectures display the characteristics of cultural exchanges, maintaining and highlighting the atmosphere of harmony and diversity.

There are considerable prospects of Macau’s real estate industry. It is expected that the real estate industry is an important part of the national economy, and it occupies a very important position in the development of Macau’s economy. Macao is a narrow and densely populated area with scarce land resources. Land has been, in the past, and even the future, the most precious resource of Macau. Looking at the development process of the Macau real estate market, we can find that it has maintained a good development trend in general, and it is greatly affected by the supply and demand relationship of the Macau market, and social and economic encouragements from the Mainland.

In recent years, the overall tone of the tightening of real estate regulation in Macau has remained unchanged, and the intensity of macro-control will continue to strengthen. At the same time, as the property market enters the period of stocks and the downward pressure on the overall profitability of the real estate industry, it is necessary to excite the vibrancy of real estate industry. In addition, it needs to innovate the land use, optimize land allocation, promote intensive and efficient land use, to accelerate the development of Macau.

Judging from the total number of per capita property transactions per year from Macau real estate brokers in recent years, the situation of real estate agency in Macau continues to struggle, but the real estate market in Macau will continue to develop steadily. Despite the pressure of the real estate market in Macau in the next few years, since Macau’s economy has a solid foundation, it’s enabled to maintain healthy and stable development. At the same time, this year’s government establishes a number of initiatives involving the real estate industry, outlines the development prospects of the pension industry, urban renewal and other fields, to provides a direction for the diversified transformation of real estate industry. Therefore, the future of Macau’s real estate industry is still promising.

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