History

Macau's history is intertwined with the history of Portugal. The first boatload of Portuguese set foot on Chinese soil in 1513 at the mouth of the Pearl River, near what is now Macau. The Portuguese hoped to set up a permanent trading base, but until the 1550s the Chinese were none too keen on the idea. In 1557, Portuguese traders signed an agreement with Guangzhou officials to rent the peninsula known as Amagao or Macau, if (in a slightly fairytale twist) they could rid the area of pirates. The Chinese, forbidden to go abroad, did a lot of their trade with India and Japan through the Portuguese and helped make Macau a thriving trading center.

By the beginning of the 17th century Macau supported several thousand permanent residents, including about 1000 Portuguese as well as Chinese and Japanese Christians, and African, Indian and Malay slaves. As well as being a trading center, Macau was also a center for Christianity in the Far East. Among the earliest missionaries was Francis Xavier (later Saint Francis) who headed into China in the 1450s, doing a better job of getting beyond Macau and Guangzhou than the traders had managed to. All this Portuguese influence had made Macau into a city of rococo houses and splendid baroque churches, including the Basilica de São Paulo, apparently the greatest monument to Christianity in the east.

The Portuguese decline was as rapid as its success. In 1850 Spanish armies occupied Portugal and in 1607 and 1627 the Dutch attacked Macau, albeit unsuccessfully. In 1637 Japan, growing suspicious of Portuguese intentions, closed itself to foreign trade. Because the Portuguese could no longer offer them Japanese silver, the Chinese also ceased trade--in 1640 they closed the port of Guangzhou to the Portuguese and Macau languished. From the mid-18th century other Europeans started moving to Macau, and the city became the major outpost for European traders in China until the British took Hong Kong. But it wasn't until the mid-19th century, when Macau's governor introduced licensed gambling, that Macau pulled itself out of the economic doldrums.

In the mid 1920s a steady stream of refugees from the Sino-Japanese war began pouring into Macau, swelling its population dramatically. They were followed by Europeans fleeing the Japanese in WWII, Chinese fleeing Communism in 1949, and Vietnamese fleeing the same thing from 1978. In 1974 a military coup in Portugal brought a left wing government to power which, eager to divest the country of its unreconstructed imperialist holdings, tried to give Macau back to China. Rumors are rife about why, but for some reason the Chinese said they didn't want it.

In the mid-1990s over-enthusiastic speculation in housing and property left a huge glut of unfilled buildings, and house prices halved. The economy, in line with economies across Asia, was faltering--a lot of hope was pinned on the new airport which opened in 1995, but it has so far consistently underperformed. In 1997 gangland killings--revolving around gambling--escalated and a hotel was raked with AK47 gunfire, doing nothing for the local tourist industry. Government officials who tried to put a stop to gang warfare often found themselves targets.

Once the joint declaration over Hong Kong was signed by Britain and China in 1984, it was inevitable that China would seek a similar agreement over Macau with Portugal. Under the agreement, signed in 1987, Macau will become a Special Administrative Region of China for 50 years from 20 December 1999. It will have a 'high degree of autonomy' (though it might be worth keeping an eye on Hong Kong to see what this means in the real world) in all matters except defense and foreign affairs. The current legislature, which Macau has been electing for the last 20 years, will continue to serve throughout the transition.