A mandatory central provident fund system could be implemented in Macao by 2026, according to the Social Security Fund (FSS).
The city’s voluntary central provident fund system was launched on 1 January 2018.
The government had previously said that it would consider setting up a mandatory central provident fund system after the voluntary system had been in place for at least three years.
According to the law regulating Macao’s voluntary central provident fund, the FSS is required to start drafting a report reviewing the implementation of the system three years after the law came into force, which must be completed within 180 days.
The FSS commissioned a research team at the University of Macau to draft the review report.
FSS officials said that according to the findings of the report, a mandatory provident fund system could have already been implemented if Macao’s economy had continued to grow from the “good performance” in 2019.
However, the city’s economy has been hard hit by the Covid-19 pandemic.
According to the officials, the review report points out that according to the latest forecast of the International Monetary Fund (IMF), Macao’s real gross domestic product could return to around its 2019 level in 2025.
The review report suggests that the government prepare two proposals for the introduction of a mandatory central provident fund, in line with the speed of the recovery of Macao’s economy.
According to the first proposal, based on a scenario in which the city’s economy would recover in line with the IMF’s forecast, a mandatory central provident fund system could be implemented in 2026 at the earliest.
In the second scenario, in which Macao’s economic recovery would lag behind the IMF’s forecast, the city’s voluntary central provident fund system could only switch to a mandatory one in 2028, The Macau Post Daily reported.
