MACAU CHIEF EXECUTIVE, EDMUND HO HAU WAH, ANNOUNCES STRING OF MEASURES IN 2003 POLICY ADDRESS TO FURTHER BOOST ECONOMY

   Macau Chief Executive Edmund Ho Hau-Wah announced last November a wide range of economic measures in his 2003 Policy Address, namely generous tax cuts and publicly guaranteed business-promotion loans, aimed at providing the population in general and the business community in particular with better living and business conditions.

   Mr Ho, a banker by profession, also announced a special credit- guarantee programme for small and medium enterprises (SMEs), which will cover up to 100 per cent of bank loans taken up by SMEs for development, innovation and restructuring purposes. Meanwhile, the Chief Executive also announced an interest-free loan scheme for SMEs planning to improve their business operations.

   The Chief Executive, who enjoys a public approval rating of over 80 per cent, also stressed that his government would further raise spending on public investments, which he said would total 1.8 billion patacas in 2003, and, as a result, create some 8,000 new jobs over the next few years.

   The Chief Executive also said his government was preparing legislation on streamlining Macau's income tax structure, namely a reduction in the tax rate to a maximum of just 12 per cent and an increase in the minimum annual income liable for tax payment to 95,000 patacas. Macau has, in fact, one of the world's lowest tax rates. The World Trade Organisation has described Macau as one of the world's most liberal economies.

   According to China's official news agency, Xinhua, Macau's gross domestic product grew in real terms 9.5 per cent last year, as against a real growth of 2.2 per cent in 2001, and 4.6 per cent in 2000. Macau's external merchandise trade, financial sector and tourism also produced healthy growth rates last year, when 11.53 million visitor arrivals, a 12 percent increase on 2001, were recorded and the official reserves of the Monetary Authority of Macau rose eight per cent to a record 30. 5 billion patacas. Macau's overall economic growth last year was among the highest in all Asia.

   Macau has reacted with delight to Moody's Investors Service's upgrading of its foreign currency ceiling for debt and for deposits to A3 from Baa1.

   Macau Secretary for Economy and Finance, Francis Tam Pak-Yuen, said the Macau government "welcomed" Moody's "very positive" decision to upgrade the Special Administrative Region's rating. He pledged the government would continue its "careful financial policies".

   Macau's new rating means that it is now three levels above the lowest investment grade. The rating is now the same as that of Hong Kong. In a statement issued by Moody's Investors Service in New York in February, the prestigious American global rating agency also said it had "added a positive outlook to the new ratings".

   Moody's said that "three years after its handover to China from Portugal, Macau has seen a strengthening of its overall economic prospects."The statement also said that the Macau government's decision to replace the enclave's traditional casino monopoly last year with a liberalised gaming-industry system was "likely to increase investment in the tourism industry".

   Meanwhile, the renowned Chinese Academy of Social Sciences said in a research study released in Beijing in March that Macau ranks fifth among China's top "10 most competitive cities".

   According to the academy, the study, which took six months to complete, was carried out by one hundred research specialists. The researchers scrutinised the "competitive advantages" and market opportunities of 200 cities in China. Macau and Hong Kong were for the first time part of the periodical study.

   According to the latest Chinese Cities's Competitiveness Study, Hong Kong ranks first, followed by Shanghai, Shenzhen, Beijing, Macau, Guangzhou, Dongguan, Suzhou , Tianjin and Ningbo.

   Macau is renowned for its unique Sino-Latin cultural heritage, tranquil environment, and open economy.