In recent years, Macao has been attempting to reduce its overreliance on the casino industry, which has long been the backbone of its economy. Key to this push towards economic diversification is Hengqin, an island situated west of the Pearl River Estuary that is less than 200 metres away from Macao at their closest point. 

Originally an undeveloped district of the mainland city of Zhuhai, and famous for its oyster farms, Hengqin underwent dramatic urbanisation after it was earmarked by the central government in 2009 to promote Macao’s economic diversification. At the time, the then Vice President of China Xi Jinping noted that Hengqin’s development would “surely bring more space for Macao’s development and opportunities.”

Xi’s remarks were on point, with Rachel Duan Yuzhou, a researcher at the University of Macau’s (UM) Centre for the Guangdong-Hong Kong-Macao Greater Bay Area (GBA) Studies, pointing out that “Macao’s economic space is very limited and the population density is also very high.”

Although the Special Administration Region’s (SAR) area grew from 29.5 square kilometres to 33.4 square kilometres between 2009 and 2025 on the back of land reclamation projects, the territory still remains the smallest of the Greater Bay Area’s (GBA) 11 cities.

“It’s very difficult to develop new industries in this limited amount of space, so new [supplementary] space is required to do this, and that happens to be Hengqin,” says Duan, who adds that the mainland territory is not meant to replace Macao’s existing industries, but is rather “an institutional interface for Macao’s economic diversification.”

Indeed, Hengqin represents an opportunity for Macao to overcome its bottlenecks, as the mainland city’s area of 106.46 square kilometres is roughly three times larger than the SAR.

To this end, China’s National Development and Reform Commission announced in December 2019 that it would support the implementation of the central government’s plan to transform Hengqin from a Zhuhai district into an in-depth cooperation area co-managed by the Macao and Guangdong provincial governments. 

On 17 September 2021, that goal was finally realised with the establishment of the Guangdong-Macao In-Depth Cooperation Zone in Hengqin – a platform positioned to serve as a new home for Macao’s overspill population and an incubator of new industries aimed at diversifying the SAR’s economy. 

Since the formation of the In-Depth Cooperation Zone, the mainland and Macao authorities have sought to bring Hengqin and Macao closer together through an array of policy measures and initiatives. As the territory prepares to celebrate its fifth anniversary this year, it is time to ask: is Hengqin still a policy concept or is it really developing into a new home for people from Macao? 

What’s life like at the Macao New Neighbourhood? 

According to Duan, the number of Macao people living and working in Hengqin has been growing in recent years. Data from the city’s Statistics Bureau certainly point to this, as the population of people from Macao residing in Hengqin jumped from 5,777 in the first quarter of 2023 to 25,703 in November 2025. Meanwhile, the number of SAR locals working in Hengqin rose from 1,421 to 6,122 over the same period. 

Sindy Cheong, a Xiaohongshu influencer, is among the growing number of Macao residents who now call Hengqin home. In 2025, she, her husband and son made the move to Macao New Neighbourhood (MNN), a residential development in Hengqin built exclusively for Macao residents by the SAR government-owned firm, Macau Urban Renewal Limited (MUR) in 2023. 

Cheong says the move was motivated by the family’s desire to improve their living environment and to provide their child with more space to move around. Indeed, she cites Hengqin’s cleaner air, lower housing density, cheaper prices and large parks as being some of the key advantages to living in the city. 

The Macao resident is also full of praise for MNN, pointing out that she “100 percent” feels that life there is more comfortable compared to her old home in Taipa. 

“Our Macao home has two bedrooms, whereas my current MNN unit has three bedrooms, with an improvement in space,” says Cheong. “The scenery and the apartment building’s public facilities have also greatly improved. Our previous apartment didn’t have any windows in the hallway and the lobby wasn’t large.”

The Macao local also highlights the fact that MNN was designed to be “a mini version” of the SAR, as the housing estate features the Portuguese pavements found in Macao and a fountain designed to look like Macao’s floral emblem, the lotus. 

MNN’s resemblance to Macao, however, is not merely cosmetic, as Cheong notes that most of the diners who frequent the chaa chaan tengs there are from the SAR, giving the place a sense of community.

Duan agrees, pointing out that visitors to MNN may feel as though they are “in a Macao-based “residential ecosystem” rather than in Hengqin, as the residential community is populated by transplants from Macao, who have access to familiar Macao-branded restaurants, convenience stores, healthcare, education, public services, as well as unrestricted internet and local TV stations. 

Are Macao residents willing to move to Hengqin? 

Despite residing in Hengqin, Cheong and her family still retain close ties to Macao, crossing the border on a daily basis for work and school. 

For Cheong, travelling from Hengqin to Macao can be a source of mental stress, as she notes that the time taken to enter Macao via the Hengqin Port can be difficult to determine, regardless of whether the channel is crowded or not. 

“Basicially, I worry about the risk of running late to work or school,” Cheong says. “Even though I’ve never been late, there’s still a mental barrier I have to overcome each time.”

She adds that a “second mental barrier” emerges once she makes it to the Macao side of the Hengqin Port, as she worries about the distance and time needed to travel to her destination. 

“Sometimes, the trip duration is shorter than travelling to the Northern District, but psychologically, there’s a barrier you need to overcome,” she says. 

Cheong’s concern is also shared by one group of Macao locals identified by Duan in her Hengqin field study, which was carried out in 2024 to assess various matters, including whether SAR residents were willing to move to Hengqin.

In her research, Duan pinpointed four types of Macao residents willing to move to Hengqin. The first were family-oriented, whose decision to live or work in Hengqin depended on factors such as liveability and the reliability of education, health and social services. 

The second type were commuter workers living in Macao or Hengqin who prioritised crossborder transport and issues such as whether or not they can drive their vehicles to Hengqin and mainland China. 

Meanwhile, the third category consisted of cross-border professionals working in Macao and Hengqin who were concerned with their ability to work in the mainland legally and conveniently. 

The fourth category were entrepreneurs who were focused on business-related questions relating to their expenses, their return on investment and the hiring of talent.

Based on this research and official data that point to “the growing scale of those living and working in Hengqin,” Duan says “the willingness of Macao residents to live and work in Hengqin is increasing.”

The academic, however, points out that turning Hengqin from a “short-term venture” into a city where Macao locals are willing to live and invest in the long term will depend on three key factors – whether or not Hengqin can be made suitable for everyday living, whether discrepancies between Hengqin and Macao’s systems can be reduced, and whether current Macao residents have a clear career pathway to life Hengqin. 

How are Macao businesses doing in Hengqin?

Macao-funded enterprises have also seen their numbers growing steadily in Hengqin over the past several years, jumping from 5,323 enterprises in 2022 to 7,681 in 2025. One such business is Social Slices (蘇蘇小瀨), a Southeast Asian restaurant located in Hengqin Huafa Mall that was jointly established by Macao millennials Jason Tam, Mike Sio and Simon Wong in June 2025. 

Tam says the chief motivator in setting up the eatery was Hengqin’s preferential policies for Macao businesses, which include renovation and rent subsidies. Hengqin’s comparatively lower rent was one of the “selling points.”

At the same time, the young entrepreneur notes that he and his business partners wanted to “plant a flag” before Hengqin’s development takes off in earnest and its foot traffic grows significantly. 

“We believe in Hengqin’s future development and that more and more people will come to Hengqin to live and work,” Tam says. “If it really becomes busy in the future, a lot of things like rent may appreciate considerably and there may not necessarily be another valuable situation like the current one that allows us to move into Hengqin.”

Doing business in Hengqin, however, is not without its challenges, as the trio admit they had to invest a significant amount of time to understand the administrative and application processes in mainland China, which differ from those in Macao. 

Meanwhile, Social Slices has faced intense competition from the many other eateries based in Hengqin Huafa Mall, including from brands that have been established in Zhuhai for many years. 

Is Hengqin a ghost city? 

Hengqin’s unstable foot traffic is another major issue, according to Sio. Although the island’s permanent resident population grew to 48,016 as of November 2025, this number is still a far cry from the original target of 280,000 outlined in the central government’s 2009 Hengqin Overall Development Plan. 

In fact, Hengqin’s sparse population and various unoccupied buildings have led to some observers calling it a “ghost city” (鬼城) – a term used to describe underoccupied developments in China. 

Cheong believes that the “ghost city” term is an overstatement, and points out that there are certain areas in the territory that are quite populated, including the area near Hengqin Port, where Macao residents tend to live, and Hengqin’s old district, which existed prior to the island’s development. 

Still, the influencer admits that the occupancy rate of buildings remains low and that there are not enough businesses, even though the current numbers fulfil basic needs. 

“I don’t think Hengqin should be called a ghost city,” says Cheong. “I think living in Hengqin is quite comfortable and you don’t have to worry about public security.”

On the topic of Hengqin’s unoccupied buildings, Duan argues that it is “not an issue,” as it reflects the city’s early stage development and phased approach to development in which the necessary infrastructure is built well before occupancy.

“It’s because Hengqin had little established industry in the past,” the UM researcher explains. “If you want the industries to take root and form clusters,  you have to provide them with the space first. You can’t wait for the industry to arrive and then build the high rises…you have to at least build ahead of demand, so the industries can move in when they are ready.”

What challenges lie ahead for Hengqin’s development? 

As Hengqin seeks to transform itself into a second home for Macao people, there are still various challenges that the city must face. Duan admits that these difficulties are the result of Hengqin being “an unprecedented and experimental” development with no other reference points. 

One issue includes translating the governments’ vision for Hengqin, which is clearly outlined in blueprints and policy documents, into minute, actionable targets, a task that is made difficult due to Hengqin’s novel nature and the need to set new standards and a clear list of guidelines. 

“Central [government] support is very clear, but the real test lies in whether the detailed rules, checklists, service windows, and inter-agency coordination can actually work on the ground,” Duan says. 

She also points out that the responsibilities of the various Macao, Hengqin, Guangdong provincial and central government officials in charge of Hengqin need to be clearly defined as well. 

“If these responsibilities are not clear, each department will perform their work in a fairly conservative manner,” the UM academic says. “A conservative flair is not conducive to a place for innovation and business.”

Another major challenge that Duan mentions is the fact that Hengqin remains a long-term project, meaning that goals such as the diversification of Macao’s economy, integration with the SAR and coordination with Macao’s systems cannot be achieved overnight. Instead, it will require effort from successive governments and an eye to carrying out each step well. 

For now, it remains to be seen if Hengqin can truly position itself as a second home for Macao residents. Achieving this long-term goal will require a two-prong approach, says Duan. 

“On the one hand, you need to consider the livability [of Hengqin],” she points out, explaining that the city needs to have a living environment that is “friendly” to Macao locals, with well-developed systems across the board in areas such as education and elderly care. On the other hand, the UM academic adds that Macao residents will “only stay here [in Hengqin] for the long run if they can find a fulfilling job,” which can only be achieved through “sustained growth in industries and employment.”