This thesis attempts to modify the method that is developed by the World Competitiveness Yearbook to quantify Macao’s degree of competitiveness and to investigate Macao’s order of ranking in terms of the degree of competitiveness in the Pan-Pearl River Delta region over the last several years. The competitiveness of Macao has been ranked first in year 2002 - 2007 among the main cities in the Pan-PRD region, implying that Macao has been keeping a high degree of competitiveness and providing a good business environment for its enterprises. The degree of competitiveness factors of Macao had increased from 2001 and gained the culmination at 2004, but a decline can be observed in 2005, although the government efficiency always ranks first. Tax/GDP can most significantly affect the degree of competitiveness and the index value for this indicator of Macao has always ranked first in the studied period. Therefore, the high degree of Tax/GDP is the main reason that Macao can maintain a high degree of competitiveness.