“If Macau rushes into opening the border with Hong Kong it might end up suffering a big loss for just a little gain,” Macau Economic Association President Lao Pun Lap told The Macau Post Daily in an exclusive interview at a coffee shop near Hoi Fu Garden last week.
Lao had headed the government’s then Policy Research Office since its inception in 2011 until June 2018 when he retired. The office was upgraded to the current Policy Research and Regional Development Bureau (DSEPDR) in September in the same year.
According to Lao, the type of visitors coming to Macau has changed. He pointed out that most of them are no longer the “richer” portion of the mainland’s population but the younger generation that knows how to spend their money wisely. He also said that in 2019, only 18 percent of the city’s visitor arrivals came from Hong Kong, but they were the group that spent their money “lavishly”.
“In pre-COVID-19 days, visitors came to Macau solely to spend their money. However, now people are more cautious about their spending. Just in case the pandemic gets worse, they would at least still have some money in their pockets. Even though Hong Kong people have a higher purchasing power, Hong Kong’s [COVID-19] pandemic situation is still unstable. Our government is being extra careful because rushing into opening the border with Hong Kong might end up suffering a big loss for just a little gain,” Lao said.
Lao said that throughout the COIVD-19 pandemic, the world has been changing every day, which directly affects the city’s economy. For example, Lao said, a sudden outbreak in Guangdong has affected Macau’s tourism revenue this month. He added that “when a big souvenir chain started to offer discounts, you knew that the tourism industry is not doing so well”.
Lao said the most important thing at the moment was for the government to sustain residents’ daily lives. Therefore, he said, he appreciates the government’s “optimised” version of its e-consumption benefits plan.
“Residents have really good feedback on the new electronic consumption benefits plan. Even though the COVID-19 situation fluctuates every now and then, at least residents now feel slightly more secure and willing to spend,” Lao said.
According Lao, with the 5,000 pataca startup fund and the 3,000 pataca immediate discount grant and a 400-pataca daily limit, it would take a while for residents who spend wisely to use the money up.
Lao also said that he agrees with the government that the “optimised” version is a better version as it helps relieve residents’ immediate financial pressure, encourages residents to spend and builds a solid base for e-payment platforms’ future development.
“If you go and visit a wet market, you can see the older generation is getting used to spending money with the e-consumption smartcard. Moreover, letting people choose between the smartcard and one of the eight e-payment platforms actually encourages bank staff to teach residents how to use e-wallets. The original plan was too confusing so even if it had been launched it would not have motivated people to spend,” Lao said.
Vaccine is the only hope
Lao pointed out that the COVID-19 pandemic has altered a lot of people’s lifestyles fundamentally, therefore in terms of Macau’s economic development, the government would need to adjust it accordingly. He said that even though a lot of people in mainland China have already been vaccinated, the government is still worried about the new COVID-19 variants.
“The vaccination rate is still low in Macau. It is only when people are fully vaccinated that we have the prerequisite to lift mandatory quarantine with neighbouring regions and countries,” Lao said
Lao acknowledged that a lot of residents are concerned about the side effects of the vaccination. He said that he hoped the local government and local companies could create more “incentives” for residents to get their COVID-19 jabs. He said besides advertising in the media, they should request doctors to clarify the “serious adverse events” after having the jab.
“The media tends to amplify the side effects of the jabs and with the Health Bureau only saying that those serious adverse events are not related to the inoculation itself does not explain why the incidents happen. The government needs to walk residents through it step by step to talk about the importance of the vaccine,” Lao said.
Lao pointed out that the government hosted roadshows to promote Macau as a safe and healthy city but if the vaccination rate remains so low, people would not be convinced that it was true. He stressed that “vaccine is the only hope” to rejuvenate the city’s economy.
Lao also said that a lot of residents are still waiting for more people to be the “lab rats” to test whether the vaccines are safe before having the shots themselves.
Pandemic as a wake-up call
Lao referred to the pandemic as a wake-up call as it really alerted the government and residents that the city needs to diversify its economy. He said that in the near future, the government should develop the city in order to stay aligned with the central government’s 14th Five-Year Plan.
“The central government has pointed five clear directions for the city to strive towards, namely traditional Chinese medicine and health care, specialised finance, cultural development, technological innovation, and e-commerce,” Lao said.
When asked about the fact that Hong Kong is the nation’s international financial hub and Shanghai and Shenzhen are the mainland’s financial hubs, what would Macau’s financial role be, Lao said “why not both”. He elaborated that Macau has a special relationship with Portuguese-speaking countries and it is an important city in the Greater Bay Area (GBA), which comprises nine cities in Guangdong province, including the special economic zones of Shenzhen and Zhuhai, as well as Hong Kong. He said that Macau can tailor its market for these countries and regions. In other words, according to Lao, Macau should target both international and national financial markets.
However, he also said that before thinking ahead, the government needed to set up regulations and laws regarding financial investment in Macau. Lao stressed that the government needed to do it “right and quickly”, as investors could easily find another market to invest in.
“On the one hand, the government has to do it right, in a sense that its tax rate has to be competitive compared to other finance markets, yet the government also needs to make the regulations clean and clear. However, refining the policies can be done while developing the market. On the other hand, the government has to set up a policy quickly because, after all, everyone wants a piece of the pie. The investors do not need to wait for Macau to develop, they can easily put their money elsewhere,” Lao explained.
Lao stressed that the government should first focus on developing Hengqin and deeply integrating with the GBA.
Macau Economic Association President Lao Pun Lap poses at a coffee shop near Hoi Fu Garden last week. Photo: Prisca Tang
