The acting governor stressed that Macau had now an "enviable" per pacity gross domestic product of about US $17,000, adding that its economy had proved to be"reasonably competitive, even when taking into account the costs of its peg to the Hong Kong dollar and, consequently, to the US dollar".

     However, Mr Pessoa acknowledged that Macau "has obviously felt the adverse effects of the Asian crisis which affected the economy as a whole," stressing that "even before the Asian crisis, the (local) economy was beginning to suffer from over-investment in the real-estate sector, fed substantially by capital flows from mainland China".