U.S. and Macau (2007)

U.S. Mission to the United Nations in Geneva

TRADE POLICY REVIEW OF MACAO, CHINA

Statement by the United States

Geneva,
April 30th

The United States would like to welcome Mr. Tam Pak Yuen, Secretary for Economy and Finance, to the second Trade Policy Review of Macao, China. We appreciate Macao, China's open and transparent participation in this review, as well as its excellent report. As always, we would also like to thank the Secretariat for its report, which provides a detailed review of the developments in Macao, China's economic and trade policy. Finally, we would like to thank the discussant, Mr. Paulo Estivallet de Mesquita of Brazil, for his insightful remarks.

The United States recognizes Macao, China's rich history as a focal point for international trade and values its unique character as a home to different ethnic and cultural backgrounds. Since the 16th century, Macao, China has been a hub for traders and missionaries, serving as a location of cultural and economic exchange between China and the West. The United States values Macao, China's recent designation as a World Heritage Site by UNESCO.

Macao, China has long maintained an open trade and investment regime, and continues to demonstrate a commitment to free-market principles. The benefits of these policies for Macao, China are apparent as its economy has recently experienced impressive growth, averaging an annual real GDP growth rate of 14.5% from 2001-05 and an even higher expected growth rate for 2006. More importantly, these policies have generated a higher standard of living for its citizens, as GDP per capita has increased by 70% from 2001-05.

Trade relations between the United States and Macao, China are strong and continue to grow stronger. The United States is one of Macao, China's largest trading partners. Bilateral goods trade between the United States and Macao, China totaled $277 million in 2006, an increase of 25 percent since 2001. From 2001-05, the United States was Macao, China's largest export market. U.S. foreign direct investment flows to Macao, China were $573 million in 2005, increasing over three hundred fold since 2001, making the United States one of the top investors in Macao, China. We look forward to continuing this productive and dynamic relationship.

We appreciate Macao, China's constructive efforts in reinforcing the WTO as an institution, and we recognize its commitment towards a successful DDA. The United States welcomed the opening of the Macao Economic and Trade Office in Geneva in 2003. We also recognize Macao's improved offer in the services negotiations.

The United States commends Macao, China on its steady and consistent improvements in its IPR enforcement regime. Monitoring efforts by Macao Customs have increased and instances of pirated and counterfeit goods seizures by Macao Customs are significantly lowered. The United States also welcomes Macao's efforts to combat consumer demand for fake products through education and public awareness campaigns targeted at tour guides and Customs officials.

Despite these positive developments, we urge Macao, China to continue to further strengthen its IPR regime to increase efficiency in its economy and help create the basis for sustained economic growth. For example, TV signal piracy is estimated to make up more than 90 percent of the market. The United States encourages the government of Macao, China to increase its enforcement of signal piracy from antenna companies. End-user software piracy is also an area of concern for the United States. Specifically, Macao, China's existing copyright law is ambiguous and does not empower authorities to prosecute infringers. We urge Macao, China to revise this law by making software piracy a criminal offense. Finally, the United States urges Macao, China to amend its existing laws to conform to the WIPO treaties.

Liberalization within Macao, China's mobile telephone market has generated many positive spill-over effects for other industries. However, other key sectors, such as basic telecommunications services, continue to contain difficult barriers to entry resulting in monopoly. We urge the government of Macao, China to liberalize this and other key service sectors to support its rapid economic development.

Macao China's rapid growth has created new public policy challenges for the government. We support recent plans to implement an accountability system for civil servants, to enhance transparency and improve the effectiveness of policy making and implementation.

We appreciate that Macao, China passed legislation in 2006 targeting money laundering activities. We encourage increased monitoring and enforcement in this area.

We look forward to reviewing the responses to the detailed questions that we submitted to Macao, China, which will further enhance our understanding of the future direction of its trade policy.

Mr. Chair, Macao, China is an open economy and a strong proponent of free trade. We share a strong common interest in its continued growth and prosperity. We hope this Trade Policy Review will help Macao, China build further on its strong record of contributions to the world trading system.

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