Macau (AsiaNews/Agencies) – Macau's rising economic fortunes validate the 'one-country, two-system' model which must be developed "unswervingly", this according to China's President Hu Jintao.

Speaking at the ceremony marking the fifth anniversary of Macau's handover to Communist China after five centuries of Portuguese rule, Mr Hu said that the "gratifying situation in Macau is closely linked to the excellent situation in the reform [process] and development on the mainland".

The President openly praised Mr Edmund Ho Hau-Wah, Macau's Chief Executive, confirming the trust the central government has in him for his work and the support he enjoys among the population.

In stressing Macau's successes, Mr Hu openly dressed down Hong Kong leaders and officials for that Territory's stagnant economy urging them to "seriously examine their failures over the past seven years".

Unlike its bigger neighbour city, Macau has in fact been enjoying unprecedented growth thanks to an expanding economy and a drop in the crime rate.

In just four years, its gross domestic product rose by 40 per cent and local authorities have enjoyed a financial bonanza enabling them to lower taxes.

Gambling and gaming resorts are the backbone of what some have already dubbed the Asian 'Las Vegas'.

Macau's casinos are expected to generate this year US$ 5 billion in revenue according to official estimates, overtaking Las Vegas to become the gaming capital of the world. What is more, the gaming and entertainment products the city offers attract not only professional gamblers but also families.

Macau's unique cultural identity which seamlessly blends East and West is the other great asset. The laid-back lifestyle, numerous historical treasures and superb cuisine, all contribute to Macau's charms. This year the number of visitors is expected to reach the 16 million mark, a great feat for a city of only 450,000 residents.

Never the less, not all that glitters is gold. Unprecedented growth has also brought serious problems ranging from labour shortages to an inefficient bureaucracy and property speculation.

Growth in gambling has also led to a growing prostitution problem.

Residents have to put up with transportation problems caused by congested streets and too few taxis. Restaurants are overcrowded and too expensive. Worse of all, an economy doped by gambling has meant a rising cost of living for most of the population.

Macau's success has thus a dark side with which both residents and administration must cope. (DS)