China more than triples Macau's size with new maritime jurisdiction

HONG KONG (Reuters) - China has granted tiny Macau control over its surrounding sea for the first time to help boost its economic development, more than tripling the size of the former Portuguese colony’s territory.

A visitor from Hong Kong takes a photo of Turbojet ferries upon her arrival in Macau October 10, 2012. REUTERS/Bobby Yip

Macau, which has an area of 30 square kilometers, will administer its surrounding sea as well as its offshore border with neighboring Zhuhai city, effectively enlarging its territory by 85 square kilometers, according to a notice on the Macau government’s website on Thursday.

The move, which will give access to mainland vessels wishing to use Macau’s waters, comes at a time when the world’s biggest casino hub is facing slumping gaming revenues and the worst economic growth on record.

Macau is the only place in China where its citizens are allowed to gamble in casinos. The new area, however, will not permit any development for the gaming industry.

“Any fresh proposal for land reclamation involving Macau’s newly demarcated waters would be reported to the Central Government; and there would be no gaming venues or commercial gaming activities in such areas,” Macau’s Chief Executive Chui Sai On wrote in a statement.

Like Hong Kong, Macau is ruled under the one country-two systems model that affords its residents wide-ranging personal freedoms that don’t exist on the mainland. Critics say these freedoms have been eroding under pressure from China.

Space-starved Macau, which has one of the world’s highest population densities for its 600,000 residents, will step up its role in national policy and help boost the nation’s maritime economy, Chui added.

China has been putting pressure on Macau, home to 37 casinos, to diversify away from an industry that brings in over 80 percent of government revenue.

Casino operators have responded by building more non-gaming amenities such as Melco Crown’s Studio City resort which opened with a Batman ride and ferris wheel.

Macau’s Secretary for Economy and Finance met with representatives of the city’s six casino operators for talks this week about enhancing Macau’s economic competitiveness.

Gambling revenue has plummeted for the past 18 months, and is expected to drop some 35 percent for 2015.

Reporting by Farah Master; Editing by Ryan Woo