Customs policies prevent Macau from being preponderant in Sino-Portuguese-speaking trade. Entrepreneurs do not hide the difficulties, but identify the advantages that can give the city a more active role
The first months of the year are illustrative of what is Macao’s lack of capacity to be an exporting or re-exporting power of Chinese products to Lusophony.
The value of exports up to May reached 5.2 billion patacas (MOP). Of this value, it should be noted that the majority is attributed to re-exports from China (88 percent). The import value, in turn, was almost 12 times greater, approximately 59.8 billion. Therefore, Macao’s trade balance shows a deficit of almost MOP 54 billion.
On the other hand, Lusofonia has a greater weight in Macau’s needs, representing 10.8 percent of the value imported by the city (647.7 million patacas).
Looking at Macau’s commercial relevance between China and the Lusophone world, one realizes how far the city is from being an exchange platform. Until April, China imported around 74 billion patacas from Portuguese-speaking countries and exported 49 billion. This means that Macau, if it were included in the national statistics, would be responsible for only 0.0007 percent of Chinese exports to the PLP. On the other hand, it would be responsible for 1.3 percent of Portuguese-speaking imports in the first four months of the year. A value that is relatively low in the national context, but much more significant in imports than in exports.
Bilateral consultant
Heiman Sou, founder of Sardinia Macau – a wholesale company that invests in importing creative products from Portugal to Macau, Hong Kong and mainland China – believes that Macau has advantages to consume in Sino-Lusophone trade. “Macau has a role as an expert or advisor within Sino-Portuguese trade. Macau residents are better acquainted with Portuguese culture and many are fluent in Portuguese,” he tells PLATAFORMA.
The commercial confidence index is also higher when passing through Macau, Sou points out. “It has a unique advantage, as Portuguese suppliers are more familiar with Macau and have a greater degree of trust in the city.”
The businessman also sees Macau as a first point of exposure for Portuguese-speaking products to China. In September 2022 he founded, together with his partner Asai Cheong, the Mercado Lusófono do Albergue, to encourage and assist companies specializing in products from Portuguese-speaking countries in Macau.
Macau has a role as an expert or advisor within Sino-Portuguese trade. Macao residents are most knowledgeable about Portuguese culture and many are fluent in Portuguese
Heiman Sou, Founder of Sardinia Macau
“I think that tourists from the mainland of China are very interested in Portuguese products, especially souvenirs, as they are scarce in China”. Since the city reopened its borders in early 2023, Sou has seen its turnover rise to 70 percent of pre-pandemic levels.
All without Macao
Gong Xiang Yang is a businessman from Wenzhou, Zhejiang. He has been in business in Portugal for 27 years and is a long-standing player in the Chinese logistics business in the country. “The Wenzhou community has more than 30 years of history in Portugal”, he says, also highlighting the influence of this community on bilateral trade.
“Today it dominates the export of Chinese goods in Portugal.”
Between January and May of this year, exports of goods from Zhejiang to Portugal reached 4.27 billion patacas – 2 percent less than the same period in 2022.
At the “Economic and Commercial Seminar of China (Zhejiang) in Portugal”, the Chinese ambassador to Portugal, Zhao Bentang, said that Zhejiang is at the “vanguard” of Sino-Portuguese economic and commercial cooperation and exchange between the two countries. More recently, at the ‘2023 Session on Economic and Commercial Cooperation and Exchange between Zhejiang, Macau and Portuguese-speaking Countries’, the Chief Executive of the Macao SAR, Ho Iat Seng, pointed out that Zhejiang and Macau have solid foundations of cooperation in economic and trade relations with the Portuguese-speaking bloc.
Yang, who is also president of the Union of Chinese Immigrants in Portugal, confesses that in these 27 years he has never collaborated with companies from Macau for their business in Portugal. He defends that entrepreneurs prefer a direct connection with the source. “Portuguese companies usually need us to help them contact factories in China directly. As we speak Mandarin, they ask us to find out if the factory is reliable”, he comments, noting that the historical and cultural connection between Macau and Portugal can be valuable in business between China and Portugal.
Expensive mediator
Sou believes that importing Portuguese products through Macau is not a viable option, mainly due to bureaucracy in customs clearance and high logistical costs. On the other hand, he doubts Macau’s ability to export large quantities to China. “Many suppliers from Portuguese-speaking countries import directly from their place of origin to China. Our Castelbel brand products are imported directly from Porto to Shanghai”, he exemplifies.
The businessman points out that Macau and Mainland China still lack some preferential policies. Sou would see “an enormous advantage for Macau” if customs clearance between Macau and the interior of China for Portuguese-speaking countries were facilitated. Other improvements he suggests include “decreasing the time to quarantine goods and reducing or even removing fees”.
Currently, the Wenzhou community mainly focuses on exporting Chinese products to Portugal, but not on importing Portuguese products to China.
Portuguese companies usually need us to help them contact factories in China directly
Gong Xiang Yang, President of the Union of
Chinese immigrants in Portugal
It is here that Sou believes that Macau can contribute more within Sino-Portuguese-speaking trade. According to the official, Zhejiang, which borders Shanghai, is looking for high quality imported products and Sou has taken advantage of this. It expanded its business from Macau to Shanghai and since then has been importing directly into mainland China.
The case of Vila do Conde
The success of Chinese goods in Portugal is recent. In fact, it starts “from the 1990s”, according to Yang. “They were a novelty and turned out to be very popular”.
The Varziela shopping area, in Vila do Conde, was chosen by Chinese wholesale traders who have settled in Portugal since 1999. Much thanks to the space, storage capacity and short distance to the Port of Leixões – the largest port infrastructure in the North Region of Portugal – and to the North of Spain.
“Currently, there are more than 200 Chinese wholesalers in Varziela, more than 80 percent of Chinese here are from Zhejiang. At the same time, more than 80 percent of the customers here are Portuguese, followed by Spaniards.”
The pandemic, in addition to not having limited the profitability of what was “always a profitable business in Portugal”, as the businessman says, also brought new opportunities.
“During the three years of the pandemic, due to travel restrictions, the Portuguese could not travel to China. However, we who have a Chinese passport were the only entrepreneurs able to continue their business trips to the country. Thus, with fewer options for goods in Portuguese companies, Chinese companies, in fact, ended up expanding their share in the Portuguese market”, he points out.
