On June 13, the European Commission and the High Representative Josep Borrell adopted the annual reports on political and economic developments in the Special Administrative Regions (SARs) of Hong Kong and Macao in 2023. The first report on Hong Kong highlights the continuing erosion of the fundamental rights of its people and the dismantling of the ‘one country, two systems’ principle.
Since the handover of Macao to the People’s Republic of China in 1999, the European Commission has been closely monitoring political and economic developments in the Macao SAR under the ‘one country, two systems’ principle.
As pledged in 1999, the European Commission and the High Representative issue an annual report on political and economic developments in Macao to the European Parliament. On June 13, the EC and the High Representative adopted their 24th annual report to the European Parliament and the Council.
The report highlights the growing focus on national security, which poses a risk to fundamental freedoms in Macao, undermines the ‘one country, two systems’ principle, and erodes Macao’s traditionally high degree of autonomy. In 2023, Macao enacted several new laws to implement the political doctrine of ‘patriots ruling Macao’. For example, in May, an amendment to the National Security Law of 2009 was adopted, expanding the scope of the Law. In December, the Law on the Protection of State Secrets, an extension of the amended National Security Law, was enacted, granting the Chief Executive of Macao additional powers. Furthermore, amendments to the laws governing elections were passed by the Legislative Assembly, introducing new vetting mechanisms for candidates participating in the elections for the Chief Executive, the Chief Executive Election Committee, and the Legislative Assembly.
In 2023, the EU continued to play a pivotal role in Macao’s economic landscape, remaining as Macao’s largest trading partner in goods, ahead of mainland China. The EU was also a significant source of foreign direct investment, accounting for 5.5% of the total foreign direct investment stock, making it Macao’s fourth largest source. Macao’s economy, a key area of interest for the EU, grew by 77.8% in the first three quarters of 2023 but has yet to recover to pre-COVID-19 levels. This growth is primarily due to the end of the strict COVID-19 restrictions and the resulting return of tourists.
