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Pro-Beijing and business candidates won the majority of directly elected seats in Macao's September 2001 legislative elections, the first since China regained sovereignty over this former Portuguese colony in 1999. The pro-democracy Association for New Democratic Macao party, however, scored a minor upset by winning the most votes and taking 2 of the 10 directly elected seats in the 27-member body. Macao's legislature, though, has little influence under a political setup that puts most power in the hands of Chief Executive Edmund Ho. In a move that will open up the enclave's vital $1.99 billion casino industry to competition for the first time in four decades, Ho's government was expected to announce in January 2002 the winners of an international tender for three new gaming licenses.
During its 443 years of Portuguese rule, Macao was the first European outpost in the Far East in 1557, the leading gateway for European trade with China until the 1770s, and a hideaway for buccaneers and Chinese criminal gangs until becoming, more recently, a bawdy city of casinos and prostitution. China and Portugal agreed in 1987 that Beijing would regain control over Macao in 1999 and that the enclave would maintain its legal system and capitalist economy for 50 years.
Macao lacks the vibrant banking, real estate, and trading industries found in Hong Kong, just 40 miles to the east along the south China coast. Its economic fortunes have in recent years been tied largely to tourism and the casino industry as well as to textile and garment exports. Macao's economy slid into recession in 1995, partly because a surge in gang-related violence, including killings and attacks on several local civil servants and Portuguese officers, hurt tourism, which makes up 40 percent of gross domestic product. Economists say that the regional financial crisis that began in 1997 prolonged the recession, which ended in 2000. In the lead-up to the handover, which took place in December 1999, the violence tailed off significantly. China reportedly helped Macao crack down on the triads, or organized crime groups, and the outgoing Portuguese jailed a major crime boss. The violence pitted rival triads in battles for control of loan-sharking, prostitution, and protection rackets.
Despite concerns before the handover that China would renege on its pledges to respect Macao's autonomy, there have been few overt signs that Beijing has tried to pressure Ho's administration. These fears had been heightened by the fact that Macao lacks the vibrant press and civic groups found in Hong Kong. Moreover, under the 1987 Sino-Portuguese deal, Macao's chief executive, like Hong Kong's, is appointed by an elite committee rather than by direct election. Ho, a Canadian-educated banker, was the committee's consensus choice. The committee's 199 members were themselves appointed by a Beijing-selected committee.
The pro-democracy camp's solid showing in the September 23, 2001, legislative elections may have allayed some concerns about Beijing's influence in the territory. Led by Ng Kuok-cheong, 43, the Association gained 21 percent of the vote, which gave it two seats, after winning just one in the 1996 elections. Pro-business candidates won four seats and the pro-China camp won another four. Turnout was reportedly 52.3 percent. Ten other seats, chosen by special interest groups, were uncontested. Ho appointed the remaining seven seats.
The government's moves to open the gambling industry will end the monopoly held since 1962 by businessman Stanley Ho. Observers, however, say that Ho, 78, and his company, Sociedade de Turismo e Diversoes de Macao, are likely to win one of the three licenses at stake. A total of 21 firms, including some of the world's largest gambling operators, such as the U.S.-based MGM Mirage and Aspinalls, based in Britain, have placed bids. The gambling industry accounts for about half of the government's annual revenues.
Residents of Macao cannot change their government through elections although they do enjoy many basic rights and freedoms. Observers question, however, whether the enclave's legal system is robust enough to protect fundamental liberties should they be threatened. The judiciary's development and future independence may be hampered by the need to translate laws and judgments into Chinese from Portuguese, and from a severe shortage of local bilingual lawyers and magistrates, according to the U.S. State Department's February 2001 report on Macao's human rights record in 2000. Only about 5 of the 100 lawyers in private practice can read and write Chinese, the report said. Moreover, Macao's mini-constitution, the Basic Law, is "riddled with ambiguities," fails to guarantee several basic rights, and grants Beijing vaguely defined emergency powers, Amnesty International said in 1999. Under the Basic Law, the chief executive appoints judges on the recommendation of an "independent commission composed of local judges, lawyers and eminent persons." The chief executive himself, however, appoints the commission.
Like the Portuguese governors who served in the waning years of colonial rule, Macao's chief executive is appointed and holds broad executive powers with few checks on his authority. The Basic Law, moreover, bars legislators from introducing bills relating to public spending, Macao's political structure, or the operation of its government. Bills relating to government policies must receive the chief executive's written approval before they are submitted. The legislature elected in 2005 will have two additional seats, both of them directly elected. After 2009, the Basic Law allows the assembly, by a two-thirds vote and subject to the chief executive's approval, to draw up a new mix of directly and indirectly elected seats.
Outside of a handful of opposition politicians like Ng Kuok-cheong, Macao has few outspoken voices for greater political freedom or transparency in government and business affairs. Most of the enclave's ten daily newspapers, including the top-selling Macao Daily, are pro-Beijing. None take an independent political line. The press also offers little coverage of people, groups, or activities that challenge Macao's conservative political and business establishment or that call for greater democracy. Meanwhile, human rights groups operate freely but generally have little impact on the territory's political life.
Practitioners of the Falun Gong, the movement combining spirituality and meditation, whose followers have been suppressed ruthlessly in mainland China, routinely perform their exercises in Macao's parks. However, the Hong Kong-based Information Center for Human Rights and Democracy in April accused Macao police of spying on more than ten Falun Gong practitioners in the enclave. Officials denied the allegations, which could not be confirmed independently.
Critics say that Macao's dominant labor confederation, the General Association of Workers, is more of a political front for Chinese interests than an advocate for better wages, benefits, and working conditions. Several small private sector unions and two of Macao's four public sector unions are independent. Legislation protecting striking workers from dismissal is inadequate, and government enforcement of labor laws is lax, according to the U.S. State Department report. The report also said that foreign workers often work for less than half the wages paid to Macao residents, live in controlled dormitories, and owe huge sums to the companies that bring them to the enclave. Macao workers complain that their bargaining power is eroded by employers' frequent use of foreign laborers, who make up around 16 percent of the workforce.
Women are becoming more active in business and increasingly hold senior government posts. They are, however, still underrepresented in politics and the civil service. Traffickers continue to bring women from abroad into Macao for forced prostitution, although there are no accurate figures on the scale of the problem, the U.S. State Department report said.