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Macau, China ink free-trade deal to scrap tariffs

China and Macau signed a free-trade pact yesterday that will remove tariffs on 273 types of goods made in the former Portuguese territory and provide its companies access to China's banking, legal and telecom sectors.

Macau was handed back to China in 1999 with promises of autonomy. It remains its own customs territory.

A similar free-trade pact between China and Hong Kong was considered a boon to the former British colony, which also enjoys separate status under Chinese rule.

But it's unclear how much Macau's deal will benefit its smaller, gambling-driven economy. Macau officials yesterday declined to estimate the pact's worth to the territory.

China wants to raise Macau's commercial profile by establishing it as a gateway for the Portuguese-speaking world.

Chinese Vice President Zeng Qinghong (曾慶紅) presided at the signing of the pact, which allows Macau investors to set up joint telecom ventures in China from today. By the start of next year, tariffs are scheduled to be lifted on 71.7 percent of Macau's exports to China, including health care, insurance, textiles, electronics and chemical goods.

Tariffs on the rest of the goods are to be lifted by 2006.

The China-Hong Kong agreement gives firms and professionals in the territory a crucial headstart over other foreign nations in the race to establish a footing in the huge and potentially lucrative Chinese market.
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