‘Come to Macao if you need funds’
With abundant capital and fewer competitors in the market, Macao serves as a good place for the Chinese mainland’s private enterprises to seek funding, said a Macao deputy to the National People’s Congress, the country’s top legislative body.
The Macao Special Administrative Region — a city world renowned as a tourist destination with a gaming industry that has surpassed Las Vegas in terms of revenue — is rich in capital, with total fiscal reserves held by the government and the private sector having exceeded MOP$1 trillion ($124 billion), according to NPC deputy Sio Chi-wai, who is also director of Macaobased technology solutions and engineering services provider CESL Asia.
Although Macao lacks Hong Kong’s reputation as a global financial center, it’s a unique platform that can link the Chinese mainland with Portuguese-speaking countries, he said.
“Not only do banks in Macao have abundant capital, many of them have close connections with those in Portuguese-speaking countries, which can help mainland private enterprises in their overseas explorations,” Sio said.
“For local banks, assessing enterprises’ qualifications is not a problem. For example, if a mainland company has a highly competitive product and needs capital for further development, people in Macao banks responsible for risk management can easily go to Guangzhou or Zhongshan to inspect the company as the transportation network between the mainland and Macao is well developed.”
Sio made the remarks in an interview with China Daily on the sidelines of the annual two sessions in Beijing.
He noted that private enterprises on the mainland, especially small- and medium-sized companies, have found it hard to secure loans from mainland banks as they are believed to have higher default risks. Loans would usually go to large Stateowned
It’s (Macao) a unique platform that can link the Chinese mainland with Portuguese-speaking countries.”
Sio Chi-wai, Macao deputy to the NPC and director of CESL Asia
enterprises.
But, the problem can be solved if those enterprises go to Macao and set up a business there.
“When private enterprises compete with SOEs in financing, normally, the SOEs would win. That’s the case on the mainland. But, when there’s no SOE involved and there are only a small number of competitors, private enterprises will have a much bigger chance of getting loans,” Sio said, referring to the situation in Macao.
“Also, the interest rates for enterprises in Macao are much lower than the mainland’s.”
Besides urging mainland private enterprises to take full advantage of the platform provided by Macao, Sio said Macao’s own enterprises need to be further encouraged to “go out”.
China had set up a $1-billion China-Portuguese Speaking Countries Cooperation and Development Fund in 2013 with the aim of promoting business cooperation between the Chinese mainland and Lusophone countries.