Don't laugh at Macau's stock plot

Editorial | Mary Ma 16 Oct 2019

Will Macau have a securities market of its own?

The idea isn't totally new. According to a former employee at the Monetary Authority of Macao, the subject has been brought up a number of times in the past.

Perhaps the Macau government is more serious this time as it is being pursued at Beijing's request dating back to February when the central government outlined the Greater Bay Area development and reportedly asked Macau to study if it was possible to create in the enclave a securities market denominated and settled in yuan.

What's interesting is that a provincial official in Guangdong jumped the gun to speak on Macau's behalf which, however, ironically forced the latter to issue a clarification.

He Xiaojun, the Guangdong cadre overseeing the province's Financial Supervision and Management Authority, said earlier at a symposium in the enclave that the authority had helped Macau make a plan to set up a stock exchange that would become a Nasdaq-style exchange for Guangdong's hi-tech companies.

He said the plan has been submitted to Beijing.

Although stopping short of blaming the cadre, Macau clarified that the feasibility study was still being conducted by a consultancy firm.

The whole thing is curious. Obviously, somebody in Guangdong could not wait to seize a leading role in the Greater Bay Area development. At the same time, the province dreams of operating its own stock exchange.

This jockeying for power aside, I am concerned Hong Kong seems to have been unable to keep up with the pace in the region as others are already up and running to grab whatever they can imagine in the game.

Will Macau's ambition to become a platform for the mainland's hi-tech companies to raise capital in renminbi succeed or fail?

That is too early to predict as there are already two stock exchanges in southern China - Hong Kong and Shenzhen. And not that far away there is another platform trading in yuan - Shanghai.

How can Macau stand out as something special? While the task is easier said than done, its legal system and accounting standards are far from being assuring.

However, that's not the point. Even if Macau fails again to come up with a credible plan as has happened time and again in the past, the development serves as a wake-up call for Hong Kong, which is suffering its worst political crisis since the 1997 handover.

Although London Stock Exchange's snub of Hong Kong Exchanges and Clearing was embarrassing and even humiliating, it was a reflection of how the world has been viewing our so-called international financial status these days.

Self-esteem is important, but how others perceive us is even more crucial. Has Hong Kong passed its prime time?

For some, its best years are gone.

A recent poll by the American Chamber of Commerce in Hong Kong showed nearly half the respondents were pessimistic about the SAR's long-term prospects, showing a marked increase from July.

Political reconciliation must begin immediately as this is the only way to save Hong Kong from the ongoing turmoil.

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