Macau is a developed economy


Markus Rimmele

To person

Markus Rimmele, born 1973, lives as a freelance journalist in Hong Kong. Reported for radio and print media from China and Asia. Until 2007 reporter for Deutschlandradio. Studied history in Heidelberg, London and Berlin. Main areas of work: China's social change, China's foreign policy, Hong Kong. Most recently: Hong Kong's port in crisis (NDR radio), Taiwan's identity (BR radio).

A historical overview

Hong Kong and Macau once emerged as European colonies on China's south coast. The Portuguese and British created important trading and naval bases here. At the end of the 1990s, both territories reverted to China, but retained a special status. Today they are still looking for their new role within the aspiring People's Republic.

The Hong Kong skyline in 2002, five years after it was returned to China. (& copy AP)

If you travel to Hong Kong and Macau today, you will find two very dissimilar cities. Around seven million people live in the international financial metropolis of Hong Kong. The city is a cosmopolitan stock exchange and trading center, has one of the largest container ports in the world and is home to a diverse media and entertainment industry. In the tranquil Macau, however, only a good 500,000 people live. The most important industries there are tourism and gambling. Hong Kong is now the much larger and more important city. However, Macau can look back on a much longer history.

At the beginning of the 16th century, the Portuguese landed on the southern Chinese coast for the first time in search of a suitable location for a trading post. Some time passed before they finally founded Macau in 1557. The city quickly became an important hub in the Portuguese colonial empire, a stop on the way from Lisbon via India to the Japanese branch in Nagasaki. Numerous buildings in Macau still bear witness to this colonial heyday, above all the ruins of St. Paul's Church. It is the symbol of the city.

First opium war

For a long time, the English also conduct their trade with China via Macau and the nearby Chinese canton (Guangzhou). At the beginning of the 19th century, however, their interests in Asia grew rapidly, and British behavior became more aggressive. To make up for their trade deficit with China, they illegally inject large quantities of opium into the Chinese market. When the German Empire takes action against the importation of the drug, the British government sends warships in 1839. The "First Opium War" ends in 1842 with the victory of the English and the Treaty of Nanking. In this, China is forced to make numerous concessions. Among other things, it has to cede the sparsely populated island of Hong Kong ("Fragrant Harbor") at the mouth of the Pearl River to the British. Britain now has its own base in southern China.

Under British rule, Hong Kong quickly developed into a major trading port. But it is always somewhat overshadowed by Shanghai, which is becoming the main trading base of the colonial powers in China. The Portuguese Macau, located on the western side of the Pearl River estuary, is rapidly losing importance compared to both cities.

Right from the start there was a lack of usable space in mountainous Hong Kong. For this reason and also to better secure their colony, the British leased large areas of the adjacent mainland, the "New Territories", from China in 1898. The lease is set for 99 years and is due to expire in 1997 - a momentous agreement, as will become apparent many years later.

Hong Kong grew steadily in its first few decades. On the eve of World War II, 1.6 million people were already living in the colony. However, this number is halved in the following years. In December 1941, the Japanese captured Hong Kong and held it until the surrender four years later when the city fell back to Great Britain. As brutal as Japanese rule and the war time are, Hong Kong's position in the post-war order has been strengthened. China is sinking into civil war between communists and nationalists. Refugees pour into the safe colony on the southern edge of the empire and give it a decisive population boost. When the People's Republic of China was founded in 1949 under the leadership of Mao Zedong, another influx began, especially from Hong Kong's long-standing rival city of Shanghai. The trading metropolis at the mouth of the Yangtze River suddenly loses its position in isolated communist China. Many international trading houses, banks and corporations are relocating their business to Hong Kong. Numerous Shanghai exiles lay the foundations for Hong Kong's modern film, music and entertainment industries.

Macau: Gambling as an economic factor

Macau, which has also been formally recognized by China as Portuguese possession since 1887, survived the world war lightly and with fewer casualties than its large neighboring British city. However, the colony lacks prosperity after the war. Portugal, impoverished under the authoritarian Salazar regime, has little to do with the small territory in the Far East and is increasingly neglecting it. Macau's economic dependence on Hong Kong is growing and gambling is developing rapidly. In 1966 the "Great Proletarian Cultural Revolution" proclaimed by Mao spilled over the border. "Red Guards", radicalized communist youth organizations, temporarily take control of the city. In the following years Portugal tried on its own to return Macau, which had become a burden, to China. But the government in Beijing rejects the withdrawal. After the chaotic years of the Cultural Revolution, the People's Republic is not yet in a position to do this and anyway wants to solve the more important Hong Kong question first.

The situation in the British Crown Colony is completely different. After the war, companies, capital and talent poured from China to Hong Kong. There they meet an army of cheap labor; they too have come from the mainland as immigrants. From the 1950s onwards, the economy expanded like never before. The city becomes a center of the light and textile industry. Artificial flowers, buttons, shoes or plastic items of all kinds - "Made in Hong Kong" is known to the world long before it even suspects "Made in China". As the economy grows, so does prosperity. Life expectancy is increasing, as is the educational level of the population. From the 1970s, the once rampant corruption fell to one of the lowest levels in the world.

Hong Kong has a very liberal economic policy. The Crown Colony is a free port with extremely low tax rates. It is developing into an important stock exchange and banking center in Asia. In 1980 the population was already around five million. The city rises to the rank of developed industrial societies. Although administered by the British, Hong Kong was not a democratic polity during the post-war decades. At the head of the administration is a governor appointed by London, not an elected head of government. Hong Kong residents are "British subjects" but not British citizens and have no right of residence in the UK.