Macau lags behind in financial leasing schemes

Lawmaker Ip Sio Kai, who is also Chairman of the Macau Association of Banks, admitted that many disadvantages preventing Macau from developing wealth management and financial leasing schemes still exist.

Yesterday, on the sidelines of the 2018 Annual Management Conference at the Macau Tower, Ip remarked that the disadvantages include a shortage of relevant laws and financial organization elements.

“Macau has mainly banks, in addition to a few insurance companies. But [there are] no other financial organization elements, including funds, bonds,” said Ip. “When there is a [large] economy, when there is a legal system and when there is [capital] security people will come to invest, with capital being collected abundantly.”

Another weakness Macau has in regard to characteristic finance development is the financial market. 

According to Ip, Macau’s own financial market, which consists of approximately 600,000 local residents, cannot support Macau in becoming a regional service platform. Ip hopes that through Macau’s position as the platform between China and the Portuguese-speaking countries, its financial market can expand to further countries, such as those in Southeast Asia.

“We might need to think about how can we attract them [investors from other countries] to come to Macau. Can Macau meet their demands in terms of wealth management preservation and appreciation?” Ip asked.

In order to attract investors from all of Macau’s neighboring regions, according to Ip, Macau needs better policies regarding talented human resources and needs to conduct regional promotional campaigns to support the market’s expansion.

Besides the aforementioned factors, Macau also lacks a trust law which can give investors the confidence when investing their money in Macau.

However, completing the development of wealth management schemes will not be an outcome of this Macau government, said Ip. 

“This [development] is continuous. If you take a look at other financial centers, their development did not take just five or 10 years. It possibly took decades. Macau also needs a long time to achieve such a thing. It is not [just] this government [who should develop the characteristic finance]. Every term of the government should do it,” declared Ip.

The Chairman of the Macau Association of Banks proposed that Macau should consider trying Southeast Asia, since the wealth of overseas Chinese population there is rather concentrated. 

In the 2016 Policy Address, for the first time the government proposed the development of the financial leasing sector with hopes of diversifying the economy. Last June, two laws aiming at easing restrictions over financial leasing were passed.