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Understanding SARs and How Hong Kong and Macau Work Within China
Written and Researched By: Eunice Wong
Published By: Meredith Yuen
Published: 15th September 2025
Pixino.com, downtown, night, cityscape, city, China, Hong Kong, urban, downtown (published 23 March 2017) Retrieved 9 September 2025
The term ‘SAR’ is commonly used around the world. But what exactly is SAR, and what does it stand for? And how exactly do SARs work with the country they’re in?
What does the term ‘SAR’ mean?
The term ‘SAR’ is commonly used around the world. But what exactly is SAR, and what does it stand for? SAR, short for Special Administrative Region, is a title given to certain regions that are part of a country but are granted the privilege to manage their own local affairs. Hong Kong and Macau are well-known examples of this as they have their own laws and governments that differ from the rest of China. Some other examples include Sinujiu in North Korea, and Aceh in Indonesia. (Government of Macao Special Administrative Region Statistics and Census Service)
Burack, E. (2022, December 3). The true story of Prince Charles’s 1997 visit to Hong Kong. Town & Country. https://www.townandcountrymag.com/society/tradition/g41855732/prince-charles-hong-kong-1997-photos/
Historical Reasons for the formation of SAR
On July 1st 1997, Hong Kong was handed back to China after being a British colony for over 150 years. Due to a change of leadership in 1842 after a war between Britain and China, Hong Kong had become accustomed to British rule and adopted British economic and judicial systems. To help Hong Kong adjust to the handover, the SAR system was formed, enabling the region to maintain its systems. (Timeline of 156 years of British rule in Hong Kong) When Macau underwent its handover in 1999, (World History Encyclopedia) it was also given the SAR title to help it adjust after being a part of Portuguese territory for over 120 years.
Impressive and Major Achievements of the Implementation of "One Country, Two Systems" since Hong Kong's Return to the Motherland - Continuously Demonstrating Immense Superiority of "One Country, Two Systems". (2024, June 30). Government Information Centre. Retrieved August 26, 2025, from https://www.info.gov.hk/gia/general/202407/01/P2024063000424.htm
Each Special Administrative Region is set up by its country’s government, and each one is run by an appointed Chief Executive. The Chief Executive could be seen as a mayor, but with a lot of power over the region. Selected by the central government, the Chief Executive is responsible for local administration and policy implementation. The SAR governments have their own legislatures, judicial systems, and legal frameworks, which are different from the rest of the country. However, their legislation must all conform to the Basic Law. (Government of Macao Special Administrative Region Statistics and Census Service) The Basic Law is a legal document that contains all the rights and duties of the Special Administrative Region and describes the system as a Special Administrative Region. (Basic Law Hong Kong Government)
Key Differences from Mainland China
Apart from economic and legal differences, Special Administrative Regions also have certain privileges that differ from the rest of the country. Firstly, Special Administrative Regions have their own currencies, like the Hong Kong Dollar and the Macanese Pataca. They also could have different main languages from their origin country - Hong Kong primarily uses Cantonese, whereas Macau uses Cantonese and Portuguese. Some Special Administrative Regions like those of China also have unrestricted access to social media exposure due to differing internet policies. This is why well-known platforms like Facebook, Instagram, WhatsApp, YouTube, and Google are accessible in China’s Special Administrative Regions, while they are blocked in the mainland. The SARs also have their own passport issuance, immigration policies, and border controls. (The Government of the Hong Kong Special Administrative Region)
Bethy. (2024, December 13). Hong Kong Airport Guide: HK Airport to City, Hotels & Lounge | Trip.com. https://www.trip.com/guide/transport/hong-kong-airport.html
Significance of SARs in China
The Special Administrative Regions of China hold particular significance as they are economic hubs of China, and are major locations for finance, trade, and tourism. Since the SARs are geographically close to China, they also enable businesses to easily tap into various markets, acting as a gateway for foreign investment into mainland China. Additionally, the Hong Kong SAR signed the Free Trade Agreement (FTA), which means reduced tariffs, adding efficiency to the trading hub. (Symaniuk, N.)
Not only do these SARs promote economic growth through markets and businesses, but they also contribute to the economy through their tourism and cultural exchange. Due to the fact that SARs have been able to maintain their unique local cultures, languages and customs (as mentioned earlier), SARs are popular tourist destinations. Hong Kong is famously known for its skyline and bustling city life, whereas Macau is popular for its many casinos, historic sites and attractions. China’s Special Administrative Regions play an important role and serve as centres for cultural exchange, blending both Eastern and Western cultural influences in one.
Benefits of the SAR system
The SAR model allows the region to benefit from both being part of a large nation, whilst keeping its international character, giving it the best of both worlds.
Some SARs are also very popular education-wise, with numerous top universities due to their internationality and academic freedom. For example, institutions like the University of Hong Kong (HKU), the Hong Kong University of Science and Technology (HKUST), and the Chinese University of Hong Kong (CUHK) consistently rank among the best in the world, encouraging researchers to collaborate and publish their findings internationally. This makes SARs strong places for research in fields like finance technology, engineering, medicine, and environmental science.
Due to the presence of a great many international schools that offer high-quality education and follow curricula from around the world (like the IB, A Levels, SATs and APs), it makes it incredibly easy for professionals from overseas to relocate with their families.
To conclude, the Special Administrative Region (SAR) framework is a distinctive model of governance that combines unique regions under a larger national structure while still preserving their individual characteristics. As demonstrated by Hong Kong and Macau, the "one country, two systems" principle has facilitated a smooth transition following their historical handovers, allowing these regions to maintain their distinct legal, economic, and social systems from those of mainland China. (Government Information Centre)
References
(n.d.). 澳門統計暨普查局: 主頁 -. Retrieved August 30, 2025, from https://www.dsec.gov.mo/zh-MO/?lang=en-US
Basic Law Hong Kong Government. (2021, April 30). Basic Law - Chapter I (EN). Retrieved August 24, 2025, from https://www.basiclaw.gov.hk/en/basiclaw/chapter1.html
Basic Law Hong Kong Government. (2021, August 26). Basic Law - Chapter IV (EN). Retrieved August 24, 2025, from https://www.basiclaw.gov.hk/en/basiclaw/chapter4.html
Bethy. (2024, December 13). Hong Kong Airport Guide: HK Airport to City, Hotels & Lounge | Trip.com. https://www.trip.com/guide/transport/hong-kong-airport.html
Burack, E. (2022, December 3). The true story of Prince Charles’s 1997 visit to Hong Kong. Town & Country. https://www.townandcountrymag.com/society/tradition/g41855732/prince-charles-hong-kong-1997-photos/
Cartwright, M. (2021, June 21). Portuguese Macao. World History Encyclopedia. Retrieved August 24, 2025, from https://www.worldhistory.org/Portuguese_Macao/
CHRONOLOGY: Timeline of 156 years of British rule in Hong Kong. (2007, June 27). Reuters. Retrieved August 26, 2025, from https://www.reuters.com/article/world/chronology-timeline-of-156-years-of-british-rule-in-hong-kong-idUSSP274799/
The Government of the Hong Kong Special Administrative Region. (2016, Dec 14). The capitalist system and way of life in Hong Kong after 2047. https://www.info.gov.hk/gia/general/201612/14/P2016121400456.htm
Impressive and Major Achievements of the Implementation of "One Country, Two Systems" since Hong Kong's Return to the Motherland - Continuously Demonstrating Immense Superiority of "One Country, Two Systems". (2024, June 30). Government Information Centre. Retrieved August 26, 2025, from https://www.info.gov.hk/gia/general/202407/01/P2024063000424.htm
Hutton, M., & Hutton, M. (2024, March 25). Timeline: Hong Kong’s new security law – from public consultation to passage in 48 days, after ‘27 years’ in the making. Hong Kong Free Press HKFP. https://hongkongfp.com/2024/03/23/a-timeline-of-hong-kongs-new-security-law-from-public-consultation-to-passage-in-48-days-after-27-years-in-the-making/
Symaniuk, N. (2021, Dec). Research into the Status of Special Administrative Regions in China. https://www.researchgate.net/publication/356822912_Research_into_the_Status_of_Special_Administrative_Regions_in_China
