Kapok: The holistic imperative

Occasionally taking a few steps backwards in order to get a better and wider perspective on one’s own status and development sounds like an imperative, and better even when it is done with comparative spin. The PricewaterhouseCoopers’s study on “Building Better Cities” that was released mid-November at the Asia-Pacific Economic Cooperation meetings in Manila perfectly illustrates this point.

Using the now well-established methodology of its “Cities of opportunity” reports that aim “to shine a light on urban success in […] cities by measuring their livability, sustainability, and competitiveness”, PwC has produced a holistic document that compares 28 cities across the APEC economies in order to provide guiding principles of best practices derived from actual experiences. Criteria and ranking are relative – from best to worst of the 28 urban centers on each of the 39 variables – and thus not normative: the idea is not to shame anyone, but to let everybody, at every level of responsibility, realize what works better. Inspirational lessons are sought out, and the whole study noticeably substantiates that “pondering” is needed if “acting” is to be successful.
I was originally attracted to the PwC study because of an op-ed regarding Hong Kong – Hong Kong is one of the 21 APEC economies whereas Macao is not, although our SAR has applied for membership –
in which the author was lamenting that out of the 28 cities considered, Hong Kong only ranked 11th and therefore concluded that the branding of Hong Kong as “Asia’s World City” was nothing more than “an empty marketing shell.”
APEC is particularly interesting for us as it brings together “political entities” with very different economic, social, cultural and political backgrounds. Consequently, criteria that define the fundamentals of any city have to be diverse and broad if they are to pay justice to all participants. Indicators were grouped together into five categories: Culture and Social Health, Connectivity, Health and Welfare, Sustainability, and Economics.
Culture and Social Health included criteria such as “tolerance and inclusion”, “cultural vibrancy”, “political environment” and “income equality”. Best performers were Toronto, Melbourne and Auckland. Connectivity, both physical and digital, encompassed, among others, “public transport systems”, “traffic congestions” and “broadband quality,” and the lead was taken by Singapore, followed by Hong Kong and Tokyo. Health and Welfare brought together criteria such as “health system performance”, “controlling crime” and “housing.” Best performers were Tokyo, Osaka and Toronto.
Sustainability was concerned by criteria such as “air pollution”, “natural disaster risk” or “public park space.” Top performers were Vancouver, Toronto and Seattle. Finally, for Economics, meaning “ease of doing business”, “GDP per capita”, “foreign direct investment” but also “incidence of economic crime,” Hong Kong, Singapore and Tokyo snatched the top positions.
Interestingly enough Hong Kong scored low for Culture and Social Health – with the Fragrant Harbor achieving its unique lowest ranking out of 28 for “economic equality” – as well as Health & Welfare, and very low for Environmental Sustainability. I could not help wonder how Macao would have fared, especially with Shanghai (13) and Beijing (14) in the middle of the pack: closer to Kuala Lumpur (15) or to Port Moresby (28)? With APEC, one has to measure itself against Toronto, Vancouver and Singapore as the three overall top performers!
Eventually, the PwC study provides a set of recommendations for what it calls “city managers” and “city and national leaders”.
To the former, the message is clear: “build a brand”! Thus, what matters is to clearly define ones’ own identity and attractiveness, and this should “ring true for all stakeholders”: a city “must preserve its unique past while inspiring residents to imagine a rich future.” Could this be the meaning of a diversification through “creative industries” and a greater reliance on SMEs, yet grounded on the gambling industry and a dynamized unique heritage?
To the latter, the path is unequivocal: strike “a new urban-national partnership”! Could this be the meaning of an extension to Hengqin island as well as an enlarged maritime perimeter together with a greater integration with the Pearl River Delta? It could very well be, if the partnership is genuine…

Published in Macau Daily Times, December 18th 2015

A heavy load and a long road!

And now we are getting Confucian Analects (8.7), 任重道遠! 10 pages of advertisement today (altogether) in the Macao Daily News (澳門日報). With the page A01 costing on its own MOP$200,000... When too much is not enough! I also like the one in A04: 感恩的心 感谢有你! "With a grateful heart, we are grateful to have you!" D11 is not bad either: 為澳為民，實至名歸！"Towards Macao, towards the people, fame follows merit!"

Chan Meng Kam (陳明金) celebrates his medal with a splash!

Getting a Silver Medal obviously means a lot to legislator Chan Meng Kam: 7 full pages of ad in total today were printed in Macau Daily News (澳門日報)! On these pics, one wonders who is the actual sponsor and who is the actual recipient… I can't imagine what it will be like when Mr Chan gets the Gold!

Bishop José Lai (黎鴻昇) also received the Silver Lotus, and obviously, not everybody is rejoicing… in 正報, 論盡媒體 but also (and even) in 澳門日報! I am sure his answer is: 「唔係，我相信唔係。」(No connection, I trust there is no connection)

Kiang Wu's board

As I was quite intrigued by Mr Fong Chi Keong's bragging about 8 members of the legislature being members of the board of the Kiang Wu Charitable Association (the organisation behind the Kiang Wu hospital), I checked, and of course Mr Fong was… right! The whole list can be found here.

The lucky winners who will "supposedly" support Mr Fong, whatever he says or wants are:
As honorary board member (榮譽理事): 高開賢  Kou Hoi In (indirectly elected)
As vice-president (副主席): 張立群 Victor Cheung Lup Kwan (indirectly elected)
As president of the executive committee (理事長): 馮志強 Fong Chi Keong (appointed)
As vice-presidents of the executive committee (副理事長): 劉永誠 Lau Veng Seng (appointed) and 陳明金 Chan Meng Kam (elected)
As managing directors (常務理事): 蕭志偉 Sio Chi Wai (appointed) and 馬志成 Ma Chi Seng (appointed)
As vice-president of the supervisory committee (副監事長): 歐安利 Leonel Alves (indirectly elected)

Four of them are appointed legislators (out of the 7 appointed in total)!

Kapok: Hooked on junkets

By mid-2015, gambling-related crimes had already gone up by more than a third, with loan sharking cases and unlawful detentions being of particular concern. This trend was just confirmed by Secretary for Security Wong Sio Chak during a media briefing held on December 2nd: for the first nine months of 2015, the overall increase in gambling-related crimes stabilized at 34% (1,118 cases in total), with loan-sharking offences increasing by 40% year-on-year and unlawful detentions by a staggering 112.5%! Mr Wong also previously insisted on a turning point in March this year, with no further explanations being given.
In fact, quite the contrary: the Secretary was adamant in downplaying the significance of this highly noticeable jump. For him, in official speak, the rise was not to be attributed to the “adjustment in the gaming industry” — even though many junket venues are shutting down and all analysts seem to concur that credit lines have been crunched. Furthermore, he insisted on the fact that most of the victims and suspects of these crimes were “non-residents” and that these offences had no spillover effects on the rest of the community, as demonstrated by a slight decrease of the overall number of crimes over the first nine months of the year. To support Mr Wong’s claim, I would even add that gambling-related crimes appear rather limited in scope, representing a mere 11% of the total number of crimes (10,347 over the period), whereas revenues attributed to “gaming” amounted to 85%! Still, there was and there will continue to be an upsurge…
Ultimately, what I find really suspicious are these efforts at attenuating the meaning of everything. This of course goes beyond Macao and local politics: most modern politicians tend to “shelter” public opinions just like a mother or father protects her or his own children from hearing too blunt a disturbing reality and eventually one always benefits from showing that he or she is fully in control of the inner workings of any situation. No wonder then that Mr Wong would remark that the Dore case — theft and default in repayment put together — exclusively resulted from the shortcomings of the gambling promoter itself, and had therefore nothing to do with the ailing situation of the gambling industry. Yet, just like it is pure hypocrisy and manipulation to use the palatable and entertainment-minded word “gaming” (博彩 bocai or even 玩樂 wanle) instead of the highly hazardous and irrational term “gambling” (赌博 dubo), “adjustment” actually means a complete revamping under duress of the industry that has made Macao a “success” over the past decade. Article 118 of the Macao Basic Law has not changed, but drawing policies that will promote “tourism and recreation” in line with Macao’s interests has taken a whole new meaning.
Contrary to what some lawyers and foreign observers profess, it is highly debatable to univocally state that “the territory would not have achieved what it did if the [gambling] industry had been over-regulated.” First, because remaking history with “if” is pointless. Second, because one could infer that whatever the legal framework, investors would still have been tempted by the proximity of such a huge market, especially in a monopolistic position and with a cultural background somehow favoring games of luck. Third, because a lot of rich Chinese millionaires, whatever the origin of their wealth, saw Macao has a way out and on top of that credit did not have to be guarantied by the casinos themselves. In short, Macao was bound to be a magnet.
Actually, I would argue quite the opposite: lax regulation of THE industry delayed necessary adjustments and long term vision — money was simply too easy to make — and we are finally witnessing the beginning of the unraveling of the promise made back in 1993 when the Basic Law was passed. Before Dore, there was Huang Shan in May 2014, with some HKD10 billion vanishing in smoke, so clearly the “adjustment period” is closely related to the “new normal”, for better and for worse.

Published in Macau Daily Times, December 4th 2015

Kapok: Make no mistake

In the past few days, in the wake of the horrendous terrorist attacks in Paris, I have been confronted by the best and the worst.
On the side of the best, you have the numerous private and public messages of outrage, sympathy, solidarity, fraternity, etc., expressed loud and clear, by friends, colleagues and strangers alike.
Both in Hong Kong and Macao, the SAR governments were very prompt in issuing communiqués extending condolences to the families of the victims and wishing the injured swift recovery. In Hong Kong, an emotional vigil took place Monday evening in Tamar, gathering some 2,500, including most of the senior diplomatic representatives as well as the Hong Kong SAR Chief Executive himself. In these moments, despite adversity and distress, humanity regains its face as countless faces standing as one. I and we are together, able to commune beyond our differences.
And then, I have been witness to passing remarks made by well-intentioned acquaintances that are truly appalling, especially coming from well-educated people. One posted an emotional message on a social media platform explicitly arguing that there is somehow a “good” immigration, one that is “humble” and thus able to blend in, and… the other one. Another person, a claimed socialist, matter-of-factly told me: “well, not all Muslims are terrorists, but you cannot deny that all terrorists are Muslims!”
I am myself from Paris. My parents live near the locations that were targeted. I go to some of these places each time I am in the City of Light, and on Friday, very close friends of mine, together with their children, were supposed to go for dinner at Le Petit Cambodge and have a drink at Le Carillon. No need to say that I was thus extremely shocked by what happened, and spent most of my Saturday making sure that my loved-ones were safe. Even now, I keep peeping at the list of the victims with a clear sense of apprehension that I might stumble upon a known name. I will be in Paris for a week starting next Monday, and can already feel an immense sorrow sinking in.
Trust me, when I say I condemn the attacks and I see only criminals of the worst sort in the perpetrators of these acts – cowardly slaughtering acts – I do mean it.
Yet, one has to be careful with passing comments, especially because we have a unique responsibility in this part of the world in promoting European values and heritage. European values do not equate with Catholicism, far from it. Ancient Greece and Rome are the matrix of European civilization — Renaissance rings a bell? — and a significant part of our neoplatonic filiation only survived because of Arab intellectuals. Heritage is a bit more than street signs, and what truly matters in regards to cultural encounters is the ability to have dialogue, exchange and cross-fertilize — the rest is misplaced nostalgia.
To my Macao friends, I say it clearly as this might prove useful for this community: it is a classic phenomenon for the last wave of migrants to try to “close the door” on the next one, as it is somehow afraid the latter will challenge its hard-gained status. Discrimination against Italian and Portuguese migrants was as bad as the one against people from North-African countries, and they are all today an integral part of the French society. Beyond the international context, what is not working anymore in France is the “integration” drive, both at school and at work. Moreover, any religion is a form of ideology that can be used for different purposes, and both the Basque separatist movement ETA and the Irish IRA were packed with Catholics.
Finally, the ones who suffer the most from terrorism right now are the Muslims themselves and we are no strangers to that state of affairs.
Ultimately, it is troubling to hear senseless words from people who come from a place that has only 0.3% of Muslims… or it just proves a point: ignorance is to be fought if humanity wants to ultimately prevail.

Published in Macau Daily Times, November 20 2015

Kapok: Money matters

In any polity of the world, public spending does matter. In fact, public finance is at the crux of public policy making and constitutes a necessary reality check on the transformative power of government. With money, governments are supposed to be empowered to do aplenty, even though, ever since the 1980s, worries about misspending and plain wastefulness have fuelled questions about the right size for the state – big or small – and of course the realm and span of state capacity and action. Having money does not necessarily make one smart, quite the contrary as our Dutch friends know very well. But being too frugal, either because of a lack of means or excessive cautiousness, is equally not a guarantee of effectiveness.

Earning more but spending less!

The execution of the budget of the Macao government was released last week and is under scrutiny in the Legislative Assembly. It concerns only the year 2014, and this reminds us that up to two weeks ago the one institution supposed to supervise the executive regarding spending public wealth was either working on a report for 2013 – in October 2015! – or simply and blindly trusting the monthly figures from the Finance department. For reasons only known to itself, the second permanent committee of the Assembly never finds the time to scrutinise interim reports in April or May. With the unfortunate and headline-grabbing suicide of the Director-General of the Macau Customs last Friday, the discussion over the budget has faded in the distant background, whereas the Chief Executive will present his policy address on November 17.
Clearly, it deserves attention, and slightly more than eye-catching and simplistic headlines regarding supposedly astounding surplus slides or inflated concerns about allegedly exploding public expenses.
First of all, the budget tells us that the Macao government is still very rich. We have accumulated some MOP246 billion in fiscal reserve and MOP131 billion in foreign currency reserves. In 2014, despite a gambling downturn of 7 months out of 12, we managed to add a good MOP77 billion to the fiscal reserve – actually more than in 2013! Bearing in mind that the government only spent MOP67 billion even without being that mindful, it can thus continue to operate for a few years – 5 or 6 – even if it waives all taxes, including the one on gambling!
Then of course, one has to look at the execution proper and the government has been pretty consistent over the years in downplaying its expected revenues and inflating its anticipated expenses. If the gap has narrowed compared to 2013 (earning 30% more and spending 30% less!), there is still a discrepancy of 10% more for 20% less in 2014, despite a slight contraction of 2.5% in gross gaming revenues (GGR).
Of course, with an expected dive of more than 35% in GGR and more than 25% in GDP for 2015, concerns seem legitimate. And yet…. The Finance Department already tells us that as of September 2015, the government has earned far more than it has spent, and based on previous fanciful anticipations, we can conclude that as of October 2015, all the administration’s bills for the whole of 2015 are already covered!

All bills covered!

Then comes the fallacy of lavish spending, especially on civil servants’ salaries and wealth-partaking social sweeteners. Salaries of personnel only represent 22.6% of overall spending, pretty much the same as France, clearly less than Denmark and slightly more than Hong Kong, but definitely less than anybody else as a percentage of GDP (less than 4% whereas it is 13.3% in France). Then, as an overall share of GDP, public spending represents about 15% in Macao, against close to 39% in the USA or more than 57% in France, and about 20% in Hong Kong.
Far from spending too much, the Macao government is actually spending too little, especially on public infrastructure, in all its guises. Lost opportunities and an absence of substantial investment in the future is more detrimental than lavish spending. But this grim picture concerns 2014. Since then, a new team has been ushered in…

Published in Macau Daily Times, November 6th 2015

Kapok: Turning a blind eye

Come on, we should be gasping for breath with this Ng Lap Seng (吳立勝) story! Keeping abreast of the twists and turns in this unraveling saga of corruption involving no less than a former president of the UN General Assembly and our own high-flying real-estate developer turned power broker should leave us with Rugby World Cup-like sore eyes! Our fingers should be numb with the frenetic flicking of pages of juicy stories! Instead of that: not much, and less in Macao than in Hong Kong.

To be fair, the English and Portuguese press in Macao has been making a real effort regarding coverage, especially since the Investigative Reporting Program of University of California at Berkeley publicly released on September 29 the confidential “Final Report on a Discreet Due Diligence Investigation into Ng Lap Seng in Macau & Hong Kong,” a report that was commissioned by Las Vegas Sands to International Risk Limited back in 2010 and obtained by the program from a Las-Vegas court.
But what about the Chinese press, the one read by 95% of the population? Since Mr Ng was arrested on September 19, the Macau Daily News, the reference daily in Chinese, only published six bland short stories mentioning Mr Ng, the longest one of less than 700 characters (about 400 words)! Only the Shimin Daily (9 stories) and the San Wa Ou Daily (10 stories) seem to have done better, but yet again on the short side and certainly not in line with real reporting. More aggressive and pro-democrat small periodicals like Sonpou or Macau Concealers have provided more in-depth treatment, but mainly derived from the Hong Kong press and with a readership difficult to measure.
The Hong Kong-based Oriental Daily News and The Sun, both characterized as “pro-Beijing leftist” tabloids, published some 14 stories each! Next magazine, the pro-democrat weekly of the Next Media Group, ran its cover story on the case on October 15 and splashed 6 pages exposing possible collusion, conflict of interest and corruption with the previous Chief Executive. Even the Guangdong-based Southern Metropolis Daily published 2,700 characters of investigative reporting on October 9.
Now, what about the issue? Mr Ng, who is of course presumed innocent, is being charged in New York on at least three counts of conspiracy to bribe, bribery and money laundering in direct connection with a USD1.3 million bribery scheme targeted at the United Nations, and this on top of the charges of conspiracy to obstruct and false statements regarding USD4.5 million in cash that Mr Ng had personally funneled to the US since 2013.
And why does it matter? It has been oft repeated that Mr Ng represents Macao at the Chinese People’s Political Consultative Conference, the highest consultative body of the People’s Republic of China, is (was?) a member of the Economic Development Committee of the Macao SAR, a formal political entity directly under the Chief Executive, and also sits on the 400-member Electoral Committee that designates the Chief Executive. Mr Ng is on top of that a high-profile board member of numerous associations, in real estate, but also in education as well as community-based and patriotic organizations. Moreover, several publicly available records link his business operations to other prominent real-estate developers as well as the former Chief Executive and Stanley Ho. Finally, Mr Ng’s name has surfaced ever since the end of the 1990s in pretty noteworthy cases of traffic of influence and corruption, even though he was never convicted, in the US, but also Taiwan and Macao – including the Ao Man Long fiasco, according to a Next magazine report of August 2014. Unfortunately, the few “persons” who allegedly know this generous “human living Buddha” (sic) appear to be only talking to the foreign press…
On the side of officialdom, with the notable exception of Ho Iat Seng, the president of the Assembly, the response has been muted – what happens outside Macao does not concern Macao. Wasn’t the UN-sponsored South-South Cooperation conference center at the heart of the bribery scheme supposed to be built in Macao?

Published in Macau Daily Times, October 23 2015.

Kapok: They talk, we listen

It was an epiphany of sorts. It was some kind of astonishment mixed with a sudden surge of exasperation: they were talking, we were listening, and everything had to be absorbed to the full. The scene was taking place on the sidelines of a SJM-sponsored dinner, and the comments were made by two of the most senior managers of the company, who were obviously well sought-after by journalists in attendance.
Mr Ambrose So, SJM’s CEO, was asked to comment on the remarks made by Li Gang, the director of the China Liaison Office, which related to the fact that the central authorities would introduce policies to support Macau’s battered economy. Mr So naturally appeared very confident that it would be so—we hope that this is what he is suggesting whenever he attends a meeting of the Chinese People’s Political Consultative Conference in Beijing—and that more cities in China will open up to individual travel schemes.

Then Mr So added that it was not only a question of “numbers” but one of “quality”, as if he were remembering that a few days back, the Secretary for social affairs and culture, Alexis Tam Chon Weng, had said that “more” was not an option. In the present conditions, we seem to be stuck at 21 million mainland visitors per year. So quality it has to be, not quantity! The question for Mr So is therefore how to, and I quote, “select the quality of visitors… and to attract high-quality and high-spending visitors”. What Mr So actually means by “high-spending” is, I am sure, preferably those who are glued to the gaming table!
And then I wondered: but how could one do that and isn’t this in contradiction with several policies supported by Beijing? The central authorities and the Macau government itself are advocating for the diversification of the economy.  In addition to this, if my memory serves me well, fund transfers to Macao by mainland visitors are strictly limited. And then, if the idea, just like in Bhutan, is to only attract the rich, what do we make of one of the four key components of Xi Jinping’s China Dream which is to “comprehensively build a moderately prosperous society”? Are creativity and culture only stemming from wealth? What has SJM done since it opened the Crazy Paris Show in the early 1980s to generate further interest in Macau in order to attract these premium customers—for more than one day, I mean? When was the last time diversification meant a little bit more for SJM than expanding culinary offerings, especially now that the “fish bowl” has gone? Well, the fact that Mr So defines the new game in town as developing Macao into “a center of amusement and leisure” instead of “tourism and leisure” says it all!

As a grand finale, Mr So was asked about the recent scandals and complaints revolving around certain junket operations. For him, junkets are of a different nature at SJM and function strictly within the law. In the words of Mr So, “I checked, they do not follow that same model”. He even went as far as embracing “a more regulated market”. Again, wasn’t it Stanley Ho himself who invented the VIP junket model in the early 1980s? Isn’t this model precisely the one that allows for legally registered stakeholders to avoid responsibility and scrutiny regarding credit extension and debt collection? I guess Mr So will not be proven wrong as long as the only solution championed by the DICJ is to create a code of ethics for junkets…

Finally, Mrs Angela Leong, SJM’s managing director, rejoiced at the temporary extension of her concession to Macao’s canidrome, announcing that SJM would engage into an ambitious renovation plan “to allow for cultural developments, and to allow young people to develop their business.” There is no doubt that Mrs Leong is listening more effectively during the meetings of the government’s Cultural Industries Committee than the ones of the Legislative Assembly. In any case however, i s whistling the tune of the hour enough? The last time SJM’s parent company invested money into these dilapidated and shameful facilities was in 1998… slightly better than the 1980s!

Published in Macau Daily Times, October 9th 2015

Ng Lap Seng: a tale of two cities

Reading the press in English over my Timorese coffee this morning (and later on the Portuguese press… note the distinction), I really ravelled at the latest twist and turn of the Ng Lap Seng story, this pure Macao tycoon, also a member of the CPPCC and of the Economic Development Committee, who got arrested in the US two weeks ago for not properly declaring some US$4.5 million that were supposed to be used to buy arts and flats... Well, now we learn that he stands accused of bribing no less than the former president of the UN General Assembly (John Ashe) in order to have his own UN Macau Conference Center! What is really fascinating is the deafening silence of the press in Chinese in Macao... I guess years and years of ads placed by Windsor Arch, Sun Kian Ip (新建業集團) and South Bay Development Co. are ultimately bound to pay off.

Macau Daily News is clearly the worst (nothing related to Mr Ng since September 23!), but even Va Kio, San Wa Ou or Tai Chung Pou only publish very brief mentions of the big article from the Wall Street Journal that everybody is using this morning. A quick check using Mr Ng's Chinese name (吳立勝) over the past few weeks returns this:

The only things decent in Chinese come from the liberal press in Hong Kong (Ming Pao and Commercial Times).

If one searches 吳立勝 on Google or Baidu however, the search can return pretty interesting results. I had already mentioned two weeks ago that Sun Kian Ip had been ditched by another UN sponsored outlet called the Global Compact (the letter of commitment addressed to Ban Ki-moon himself and signed by Mr Ng is truly fascinating: "I am pleased to confirm that Sun Kian Ip Group supports the ten principles of the Global Compact with respect to human rights, labour, environment and anti-corruption"). But there is more: fascinating pics of Mr Ng and all his acquaintances in Macao can be found here and here. There is also an interesting article on Yiernews pointing to Mr Ng's buddies for the South Bay Development Co.

One of my personal favorites is this one (authorised by Chinanews; I hesitated a long time with the one of the Charity dinner given by Sun Kian Ip in 2012... but it was not Chinanews sponsored):

Clearly, Ho Iat Seng, the president of the Legislative Assembly in Macao and also the Standing Committee member of the National People's Congress, is arguing for a proper mechanism within the CPPCC to expel Mr Ng, if 市民日報 is to be trusted.

Who you gonna call?

Here we go, demonstrations in front of the China Liaison Office will be staged today…again! It makes the headlines even of the slightly pro-establishment Portuguese newspaper Jornal Tribuna de Macao. Good old journalism is badly needed there, but the only place where a great background analysis can be found is with Macau Gaming Watch.

I especially like the following image:

So, basic principles for investigative journalism should be: follow the money and who is the boss?

The fact that spoiled "investors" or "depositors" (whatever you want to call them) keep coming back to the CLO should arouse the interest of some...

The only time I have seen the name published (despite earlier demos) is when the International Union of Operating Engineers sent a letter (also to the press) asking the very able DICJ to look into that Charles Heung guy... On September 28th! Nothing before that (or so little, published in Macau Post Daily on September 17th under the generic term "Dore depositors petition Liaison Office over funds")! Nobody can read Chinese or what?

If people stopped wondering too much about the ulterior motives of the International Union of Operating Engineers, I guess some pressure might be exerted on the regulator to finally do its job. If the DICJ was doing its job, then the Union would become irrelevant, right?

Kapok: Who is in charge?

Back in my student years, I wrote a short essay about the massive peasant demonstrations that took place in France in the 1960s, which started before the May 1968 social unrest: Common Agricultural Policy was just starting (1962); younger and more challenging famers’ unions were coming of age; and Charles De Gaulle, the tutelary figure who had given pride back to the French in 1940, had become the first-ever directly elected president in 1962, and yet he was getting old and his prestige was fast-eroding – political personnel, institutions and society were not in congruence anymore.
On the one hand, peasant demonstrations were pointing to a chasm between the demands of a significant part of the population who were confronted with a fast changing environment and disappointing answers given by a far too rigid domestic political establishment. On the other hand, these rallies were in effect strengthening the state as they considered public institutions as the necessary and exclusive intercessor, and this even when unloading rotten fruits and vegetables in the courtyards of the ‘préfectures,’ the symbols of the state in local administrative units. Challenging and yet legitimising!
What is presently happening with the Dore case in Macao and what occurred in May with the disgruntled construction workers taking to the streets to protect their rights are two instances of this tumultuous interplay between state, government policies, corporate practices and segments of the society being confronted with unfair situations. Not only are they revealing a lack of appropriate regulatory environment but also of a possible challenge to the legitimacy of the local state apparatus.
Both cases involve mainland workers or investors, and each time we were made aware of their pleas because the victims took their cases to the China Liaison Office.
In May, the number of people involved was in the hundreds and it lasted almost two weeks – images of disgruntled workers marching from Taipa and occupying the street in front of the Liaison Office were splashed across social networks as well as the pro-government and liberal Chinese press. At stake were large dismissals at several casino construction sites and claims of unpaid wages (up to seven months), and the realisation that with only one-month to settle their case, dismissed workers might be in for spoliation.
Lionel Leong, the secretary for economy and finance, had to step in heavily and openly state that instructions were being coordinated by his own secretariat as well as other administrative units, including the Human Resources Office and the Labor Affairs Bureau.
Still, one can wonder why disgruntled workers would turn to the Liaison Office. Could it be because they have more trust in the higher echelon of the Chinese state to protect them? Could it be because the labor laws are in Macao exclusively drafted by their employers? Or because these laws as they exist are conducive to many forms of discrimination?
Earlier this week, a handful of investors in the Dore junket who are not able to withdraw funds they placed with the company also ended up in front of the Liaison Office. Although there is a clear irony involved in these claimants concerns for the whereabouts of what they call their “hard-earned money”, the questions that arise are of the same nature. Why would they turn to the Liaison Office to protect their assets within the gaming sector? Could it be because the laws allow both the gaming operator – Wynn – and the gaming promoters to play dumb? Could it be because the regulator itself is in denial of the reality regarding the adequacy of the laws and the scale of money laundering that goes on unsanctioned? It was only last week that the legal advisor of the DICJ was recommending a mere Code of Ethics for junkets! Once again, Lionel Leong had to vehemently step in… only after.
In the end, legitimacy will be secured if the right tools and the right channels for mediation are put in place.

Published in Macau Daily Times, September 25th 2015

Kapok: The art of the meaningful

I am no economist, and yet I have enough interest in political economy to figure out when something is right or not. Such is the case with the dramatically loaded use of the word “austerity” by the government. Is it right – in both its rational and moral senses – to use the word “austerity”? And if it’s not, why use the word despite its dreadful adverse effects?
One can always blame translation. Should we translate 緊縮 (jinsuo) as “tightening” rather than “austerity”, which is better rendered by 撙節 (zunjie), that better conveys the notion of frugality? But then, jinsuo is also clearly used to express a “drastic” reduction, such as “credit crunch”, so it does not seem to be an overstretch to translate緊縮計劃 as “austerity plan”, and Macau Daily News indeed refers to 緊縮政策 when it describes “austerity policies” put in place in debt-ridden European countries.
When did we start talking about “austerity” for Macao? Back in June 2014 at the very start of the dwindling of the gaming industry? In December 2014 when the Budget Law for 2015 was passed? Nope.
Only in April 2015, precisely when the budget of the government was being re-examined and revised. At the time, a vaguely worried Chan Chak Mo, the president of the second permanent committee of the Legislative Assembly in charge of supervising public accounts, raised a pale orange flag to say that if monthly gross gaming revenues (GGR) fell below MOP17 billion then Macao could face a budget deficit by year-end. By his sophisticated calculation, MOP20 billion in GGR per month would total MOP240 billion for the year, and given the tax on gambling of 35%, that would in turn translate into MOP84 billion in government’s revenues… almost exactly the amount envisioned by the revision of the Budget Law in May!
Why the MOP17 billion threshold? Because then, we might really have a deficit – a “crisis” in Chan’s vocabulary – but no explanation (other revenues? actual execution of the budget?) was given regarding the MOP3 billion discrepancy. In the new Budget Law, prospective revenues were revised downward, from MOP154.7 to about MOP120 billion, but then expenses went up slightly (!), from MOP83.72 to MOP83.76 billion…
Ultimately, if need be, Chan revealed that expenditures could “easily” be cut across the board by 5%, without affecting social welfare-related spending or heavy investments. This is, albeit slightly pumped up regarding minor investments (-10%), what was announced on September 1st and Chief Executive Chui Sai On has confirmed that these cost-cutting measures were here to stay.
By any account, the seemingly resolute acts taken in the wake of the bad results of the first eight months of 2015 – we are now below the not-so-thin red line of MOP20 billion per month – do not equate to austerity, which is defined as a set of policies aiming at, by way of spending cuts or tax increases or a mix of both, the reduction of government budget deficits. In the case of Macao, this is an (inflated) “anticipated” deficit: we ran a surplus in 2014 and then we have more than MOP350 billion accumulated in fiscal reserve – not even impacted, so we are told, by the ongoing financial turmoil now affecting Shanghai and Shenzhen. Moreover, the government expects these cuts to save MOP1.4 billion, a mere 1.7% of the budgeted expenditures – so much for the rigor of the measures!
Finally, the Execution of the Budget is only 60% – if we rely on the 2013 figures as the most recent ones have yet to be examined by the Assembly – meaning the government spends, in any case, less than 2/3 of the money it said it would!
Taking a stand and publicly explaining what these spending cuts actually mean – the shy first steps in eliminating waste within public administration and restoring trust of the citizenry in its public service – can only benefit Lionel Leong. Resolutely and personally taking the lead in pushing through the ongoing revision of the new Budget Law framework, thus positioning himself as a manifest proponent of greater transparency and efficiency regarding public finances, might not hurt either.

Published in Macau Daily Times, September 11th 2015

Kapok: Accountable Responsility

For any political leader, probing the hearts and minds of constituents is of utmost importance, whatever the political regime. In a democratic setting, elected officials have learned to engage at every turn with the people they derive their power from. Gone are the days when one would regenerate his or her “representative” status only at election time: one’s presence on Twitter is imperative, and not only to cunningly (often perilously) grab the headlines, but to foster public participation and nurture one’s political course of action via the many corrective bits that constitute an audience’s reaction, measured in levels of re-tweeting, liking and commenting. The power and beauty of social media do not only spring from their instantaneity and their reach but from the reactivity and interactivity. They are indeed a much more sophisticated channel than basic opinion polls that verge on popularity contests. Social media allow for participative democracy to cut across a mere slogan, even though they cannot and will never replace the act of voting, which is the actual exercise of power by the citizenry, and thus of accountability.
In an authoritarian context, regardless of the oligarchic or corporatist manoeuvrability, citizens are also being called upon. The lesson retained from the twentieth century is that no form of dictatorship can aspire to longevity if it does not somehow live up to the promise of a “rule for the people” – the greater good of the community remaining a distinctive finality. Thus demands from the society have to be accommodated, albeit with very stringent constraints. In Iran, many believe that the “Islamic Republic” serves as a “façade” for religious interests to clinch power while allowing for civil society to be placated. Quite tellingly, social media were at one point used as reversed illiberal weapons to track down activists challenging the regime, and today still, most Iranian netizens are denied access to Twitter while President Hassan Rouhani prides himself on having 378,000 followers (last tweet on August 9th) while even Supreme Leader, Ayatollah Seyed Ali Khamenei, is followed by less than 150,000 people. In the People’s Republic of China, many policies are opened to so-called “public consultations” and clearly there have been some interesting attempts at (very) local democracy. The regime today hammers that “democracy” is indeed one of the twelve core socialist values – along with freedom. But here again, engagement of and with the people follows very strict rules, as more than 250 human rights lawyers have been learning the hard way during the summer. Moreover, if China is home to the biggest Internet population on the planet – 668 million – and allows for citizens to express their concerns and participate in the public sphere, this can only ensue in a narrowly enclosed perimeter: Xinhua ultimately rules and the new cybersecurity law currently “under discussion” will fully “legalize” the usual practice of suspension of service and denial of access as soon as there is a hint of threat to “social order”. Thus, Virtual Private Networks that have been heavily targeted since January 2015 could be deemed “illegal”.
Public consultations and the use of social media can be characterized as a form of responsibility sharing. For a leader today, the source of political legitimacy matters less than the impression (at least) that he is ruling for the benefit of the whole community. Shouldering off part of the responsibility thus really comes handy. The ever-increasing use of “public consultations” in Macao is a good reminder that despite our lack of democratic institutions, the commitment to liberal values enshrined in the Basic Law together with their actual practice can be put to very potent use when it comes to accountability. Nobody will be voted out (or weep and resign), but then prospective public policies are openly discussed and challenged, omissions and shortcomings alike: the meticulous account provided by some media – the public meetings transcripts by All About Macao in particular – regarding the present public consultation on new reclamation areas is in that respect to be commended. Irrefutably, the quality of our future rests upon our freedom of expression.

Published in Macau Daily Times on August 21st 2015

Kapok: Head counts or headaches?

Censuses have been in existence for millennia, the first known having been undertaken by the Babylonians and in Pharaonic Egypt in the Third Millennium BC. The oldest existing census was conducted in Han Dynasty China in 2 AD when Imperial China was believed to be home to the largest population in the world with 59.6 million inhabitants. Interestingly enough, references to these distant head counts usually indicate some level of “reliability”. Censuses appear to be associated with advanced civilizations and sophistication of public administration. Today, the universal and periodic acquisition and recording of key population indicators determine the shape and scope of public policies.
In Macao, the first census dates back to 1867 when 81,525 individuals populated the Portuguese enclave. The latest census of 2011 recorded a total population of 552,503 and the latest estimate from the Statistics and Census Service puts this figure at 636,200 at the end of 2014.
On July 30th, the government’s Policy Research Office released its Study Report on the Population Policies of Macao, and expectations were running pretty high. Unfortunately, some serious doubts can be raised on the intent and accuracy of the document.
Although it is true that Macao’s population is today characterized by a low birth rate, one of the longest life expectancies in the world, a population growth fuelled by immigration, heterogeneity between local and non-resident workers, a need to “import” young workers to compensate for an ageing population, and the fact that a low rate of analphabetism is emulated by an equally low level of tertiary education, why do these conclusions need to be drawn from a study by the University of Peking? And then, why not phrase the main challenge of Macao as being the staffing of a (super-) fast hospitality and gaming industry with low-skilled as well as highly competent people who are mostly imported from the outside (today, 45% of the active population is made up of “non-resident workers”, twice that of 2010, and less than 20% of the population have been to university) while at the same time maintaining acceptable conditions in one of the most densely populated territories on the planet? With further diversification ahead, what was true in the past decade will be even truer in the next.
Every single piece of information in this report seeks to tone down the issues at hand and is presented as a validation of insufficiently published indicators and reports to appraise the quality and relevance of past and upcoming public policies. It is more a justification exercise than an objective assessment from which to derive public policy recommendations.
Projections are on the conservative side: the population figures of 710,000 by 2020 and 750,000 by 2025 are based on lower growth to come. With a population increase of 25,500 people in 2012-2013 and close to 29,000 in 2013-2014, should not we at least consider a higher limit – despite the recent sharp GDP decline – according to which the threshold of 710,000 could be reached by the end of 2017? Unless, of course, there is a significant contraction of non-resident workers and thus a sudden change in immigration policy – unimaginable with 19,000 additional hotel rooms in the making and the drive for Macao to become a world-class tourism and entertainment center. Is it reasonable to argue that HR issues can be significantly addressed by an untapped reserve of women and a fast ageing population? What is the rationale behind an acceptable (“not saturated”) carrying capacity of 22,000 people per sq. km by 2025? What are the envisioned measures to optimize transportation and tourism facilities for sustainable development? Why not include indicators like “waiting time” for health services instead of boasting that Macao is on par with countries from East Asia based on the number of doctors and hospital beds per 1000 residents? Should not the development of the “Grand Macao” as the solution to all challenges be discussed?
The 2006 predecessor of this Policy Research Office was supposed to emulate Hong Kong’s Central Policy Unit: there is obviously still room for improvement!

Published in Macau Daily Times, August 7th 2015