Macau was declared a "free port" in 1849, establishing very few barriers against the import of goods and services and promoting export to the international market. Historically, the United States has remained one of Macau's major trading partners, with exports to the United States reaching US$1 billion dollars in 1999 or 46.9 percent of all exports, consisting mainly of textiles, garments, and manufactured electronics. The European Union is the second-largest trading export market, accounting for US$663 million or 30.2 percent of total exports. China and Hong Kong were also important destinations for Macau exports, accounting for 9.2 percent and 6.8 percent of exports, respectively.
Imports originating from China accounted for US$725 million, or 35.6 percent of its total imports in 1999, so Macau was running a considerable trade deficit with this country. Hong Kong was the second largest source of import accounting for US$368 million or 18.1 percent of total imports. The European Union, Japan, and the United States were other major sources of imports.
Macau's economic vulnerabilities were exposed during the sharp oil price increases in 2000 and 2001. It also faces increasing competition from low-cost, mass-production enterprises in neighboring China and is vulnerable to changes in the U.S. and EU markets.