MOP 6.00 Closing editor: Alex Lee Number 535 Friday May 9, 2014
Publisher: Paulo A. Azevedo
Cards fall wrong way
China UnionPay Co is reportedly about to curb the illegal use of card devices for gamblers who cash in tens of billions of yuan in Macau. Consequently, casino stocks dropped almost 10 percent yesterday, further boosting industry volatility. Negative news on the crackdown on illegal money transfers and visas has spooked investors. A massive sell-off frenzy ensued. Markets are ‘overblowing’, analysts tell Business Daily Pages
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Macau Inc In the first quarter of the year, 118 million patacas of the capital invested in the incorporation of new companies came from Macau, and 53 million patacas from over the border
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Phase one of the new prison has experienced endless delays, mainly due to changes required due to the condition of the land. The shortage of labour has also added problems to the construction of the new prison. The Land, Public Works and Transport Bureau told Business Daily that estimates point towards the completion of phase one in August
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Government will allow pension funds in Macau to start contracting risky products like swaps, options and futures that could undermine the safety of pensioner’s money if used wrongly. AMCM concedes derivatives are ‘undeniably risky’ but also a ‘powerful tool to reduce risk’ Page 3
April analysis April’s imports and exports rose surprisingly in China, wrongfooting all the analysts’ forecasts. The results left a trade surplus of US$18.46 billion Page 11
Real estate law lesson
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The Real estate Agency Law is welcomed by the biggest agencies. They complain, however, about difficulties in recruiting staff to comply with the diploma requirements. The small agencies say it’s hard to stay afloat. The law is new and its already getting amended Pages 6 & 7
May 9, 2014
Macau Macau Management Association celebrates 30th anniversary Macau Management Association will celebrate its 30th anniversary on 5th July with a two-day ceremony to be held in Macau Tower. The highlight of the first day will be the Instituteâ€™s general assembly as well as a dinner attended by Chief Executive Fernando Chui Sai On. On the last day of the festivities a conference on management plus several workshops will be organised. MMA is a non-profit organisation that owns the Macau Institute of Management (MIM). The Institute (see photo), in collaboration with the American Chaminade University of Honolulu (CUH), launched the only US Master of Business Administration degree in Macau in March.
More money in new companies Registered capital totalled MOP191 million in Q1
acau welcomed the incorporation of 1,126 new companies in the first four months of this year, up some 12.3 percent over the previous twelve months. Of these, the majority was in wholesale and retail with 423 new companies, followed by 237 offering business services. According to the latest figures released by the Statistics and Census Service, the value of registered capital totalled 191 million patacas, 23.7 percent more than in the first quarter last year. The majority of the new companies were fully established by Macau shareholders, at 715 of the total, while 165 were joint ventures between shareholders from Macau and other jurisdictions. Companies with a capital investment of under 50,000 patacas accounted for the majority of
incorporated companies with 67 percent of the total. The total value of these companiesâ€™ capital was 20 million patacas, representing just a
tenth of the total value. In addition, 44 companies registered with a capital of one million patacas or more, the total value of which was
122 million patacas. In the first quarter of the year, 118 million patacas of the capital invested in the incorporation of new companies derived from Macau, and 53 million patacas from mainland China. Of the latter, 26 million patacas alone came from the Pearl River Delta region, with Guangdong province accounting for 24 million patacas. Meanwhile, a total of 155 companies closed down at the end of the first quarter. According to official figures, this number is 26 more than that of the same period in 2013. The registered capital of companies undergoing dissolution dropped by 84.9 percent, to 28 million patacas. The latest figures reveal that there were 44,724 companies registered in Macau at the end of the month of April. S.F.
May 9, 2014
Toxic pensions The government has given the green light to pension funds in Macau to start contracting risky products like swaps and other derivatives, financial instruments that caused massive losses in the US and Europe. AMCM admits derivatives are ‘undeniably risky’ but also a ‘powerful tool to reduce risk’ Alex Lee
he Monetary Authority of Macau (AMCM) will allow pension funds in Macau to buy derivative financial products like swaps, futures and options, risky assets that could undermine the safety of pensioners’ money if used wrongly. In the Official Gazette published on Wednesday, in which AMCM gave the go-ahead to pension funds to purchase derivatives, the institution says that these products can only be bought with the objective of reducing the exposure risk of the fund’s investments and to achieve a better efficiency. The use of derivatives to leverage pension fund assets is forbidden, the AMCM emphasised to Business Daily. The problem is that these
are the same conditions and clauses under which authorities in Europe and the US advised pension funds, public companies and banks on how to manage these products. The bankrupt of Detroit and the public transport companies’ scandal in Portugal are the most recent cases of swaps investments gone wrong. “While derivatives are undeniably risky in some applications, they also provide a powerful tool for limiting risk”, AMCM told Business Daily.
Risk vs. speculation There are dozen of derivatives but future contracts, options and swaps are the most commonly used by governments, companies and investment
funds. Derivatives are contracts and can be used as an underlying asset and are generally used as an instrument to hedge risk but can also be used for speculative purposes. Swaps, for example, are like an insurance that one part contracts to protect against some event - a pension fund could contract this product to reduce the risk arising from interest rate or currency fluctuations. Unlike most common options and futures, swaps are not exchange-traded instruments but customised contracts traded between private parties. “In the case of swaps, it is essentially agreements between two parties to exchange sequences of cash flows over a certain period. As such, parties
Holiday performance a blusher for Sa Sa
eaker purchasing power from visitors accounts for a yearon-year decline in same store sales growth for cosmetics retailer Sa Sa International Holdings Ltd in both Hong Kong and Macau during the Labour Day Holiday, the company’s unaudited sales performance filed with the Hong Kong Stock Exchange after trading hours on Wednesday shows. For the three-day Labour Day holiday starting on May 1 Sa Sa recorded a 5 percent year-on-year drop in same store sales growth when compared with the corresponding period last year from April 29 to May 1 for shops in Hong Kong and Macau, the filing noted. In this year’s Labour Day holiday, Sa Sa’s retail sales in both cities also experienced a 1 percent year-on-year decline. The cosmetics retailer calls the holiday performance ‘far lower than
expected’ in the filing, claiming that ‘weaker purchasing power’ from mainland Chinese visitors in the period has led to a drop of over 10 percent in total average sales per transaction, despite the company enjoying some 10 percent growth in the total number of transactions. This year, Hong Kong Immigration Department announced a rare decline in visitor numbers during the threeday Labour Day vacation, when the city received 387,700 mainland visitors, down 1.7 percent from the previous year. Macau saw higher visitations than Hong Kong in the May Golden Week, as Public Security Police announced last week that the territory had welcomed 551, 957 travellers in the May 1-4 holiday, surging by one-fifth from the previous year. S.L.
to the agreement may benefit from reducing financial uncertainty; that is, financial risk”, explained the monetary authority to this newspaper.
Time will tell According to AMCM, pension funds in Macau are limited to buying two kinds of swaps: to protect against yields of investments and currency variations. For options and futures, the margin is wider, with contracts allowed also for credit risk, price yields and guarantees for future acquisitions. In Macau, there are 10 financial companies (from banks to insurers) managing around 50 pension funds, data from AMCM show. Swaps are a costlier
word in the US and Europe during and after the 2008 financial crises where the misuse of these financial instruments and lack of proper regulation cost the jobs and pensions of millions around the world with billions of losses, the shockwaves of which are still being felt today. Creditdefault swaps took down Wall Street in 2008 and last year it was Detroit’s turn. The former world’s auto industry capital defaulted on US$18.5 billion of debt with dozens of swap contracts associated that forced the city to file for bankruptcy, washing out pensions and health benefits at a stroke. In Portugal, swaps contracts made by several transport public companies created a US$2 billion loss in the public accounts.
May 9, 2014
Reported UnionPay crackdown looms over casinos UnionPay has stepped up measures against illicit funds taken to Macau, namely illegal handheld devices for gamblers to cash in, South China Morning Post reports Tony Lai
tate-backed bank payment card China UnionPay Co is reportedly introducing new practices to curb the illegal use of handheld card devices for gamblers to cash in tens of billions of yuan here. Gaming analysts, however, have played down the impact of the crackdown on the territory’s gaming revenue, worth seven times as much as that of the Las Vegas Strip. Hong Kong newspaper South China Morning Post reported yesterday that UnionPay had launched measures on Wednesday night to ‘combat overseas money laundering, capital flight and other illegal bank card use’ in Macau. But the newspaper did not detail the content of measures. China UnionPay said it is implementing risk prevention measures while working with regulators and law enforcement personnel to share information, the South China Morning Post reported. The state-backed debit card company could not immediately be reached for comment. Shares of the territory’s six gaming operators all tumbled yesterday with Melco Crown Entertainment Ltd dropping as much as 12.4 percent in the Hong Kong Stock Exchange, the worst performance since its dual listing in December 2011. Galaxy
Entertainment Group Ltd and Wynn Macau Ltd dropped as much as 9 percent and 11.6 percent, the most in more than two years as well. Macau is facing a capital-flight crackdown as Beijing ramps up concerns that illicit funds are being funnelled out of the mainland and into casinos in contravention of national currency controls, the Post quoted unidentified security and gaming sources as saying.
Rapid rate Handheld UnionPay payment devices from the mainland have been illegally imported into Macau ‘at a rapid rate’ used for unauthorised dealings here that appear as domestic transactions, the English newspaper said. The newspaper quoted a pawnshop source in Macau as saying that the transactions using UnionPay cards are worth 200 billion yuan (259.48 billion patacas) a year, with around 20 per cent of them, or 40 billion yuan, through mobile devices. The use of mobile card-swiping machines has caused the pawnbroking business here to slump, the South China Morning Post reported, citing industry group Macau General Chamber of Pawnbrokers.
“The growth in payment cards is huge because of China’s corruption crackdown. Mainland gamblers in Macau don’t want to reveal how much they gamble so they use cards,” the Post quoted another source as saying. The same source said this meant under-reporting of gaming revenue here, adding that about US$90 billion (720 billion patacas) of gaming revenue went unreported last year despite the casinos reportedly raking in US$45 billion in the same period. HSBC and Barclays banks released a research note yesterday respectively playing down the material impact of the crackdown on gaming revenue. Citywide gaming revenue expanded by 17.5 percent from the previous year to 133.52 billion patacas in this year’s first four months. HSBC believes that the impact on the gaming industry is limited as only unauthorised UnionPay devices are the target of this crackdown, not the territory’s pawnshops, which are one of the channels for gamblers to cash in. Gaming revenue from the mass floors of casinos here could still grow 34 percent year-on-year last month, despite the raids of Macau police looking for the devices in the past few weeks, HSBC said.
Just bark Macau’s Public Prosecutor’s Office said in March that it was investigating four mainlanders on suspicion of trying to use a UnionPay handheld device to let gamblers obtain some 45 million patacas in cash. The Office issued a written statement saying at the time that it was “highly concerned about recent discoveries of the use of UnionPay devices for committing offences in Macau”.
KEY POINTS UnionPay tightens measures here Illicit funds via UnionPay handheld device may total over 40 billion yuan here All gaming shares tumble Investment banks play down impact
Barclays also said in a note yesterday that VIP gamblers and most premium mass gamblers will not cash in here via UnionPay cards as they have other means to do so, after discussion with its gaming sources here. “Judging from past experience, it’s often all bark and no bite,” Grant Govertsen, a Macau-based analyst at Union Gaming Group said yesterday. “The shortening of a visitor’s stay or the stricter use of cash cards won’t necessarily curb gamblers’ capacity to gamble.” Indeed, it is not the first time there have been reported measures by UnionPay targeting illicit transactions here. In June 2012, UnionPay was reported to have lowered the daily limit on the value of transactions made in Macau with any of its cards to 1 million yuan from 10 million yuan. Hardly any impact has been seen on the territory’s gaming revenue, which expanded 13.5 percent in that year. With Bloomberg News
Macau movers and shakers dominate Japan bets A flurry of activity right now but a little delay could mean that the resorts might not open in time for the Summer Olympic Games
ompanies operating in Macau head the list of applicants positioning themselves for one of the 2 ‘big’ licences for building Integrated Resorts (IR) that the Japanese Government will probably approve this year. According to a report published by Union Gaming Research Macau, Galaxy, Sands, Melco Crown, MGM and Wynn will fight for a ‘big’ licence on the Macau side, while Genting Singapore and Japanese SegaSammy complete the list. The report states that ‘any operator not appearing on
this list … is unlikely to be a serious contender for one of the ‘big’ IR Licences’. Concerning the ‘small’ IR licences, only Macau Legend from the peninsula is an applicant from the territory. The rest of the companies that are likely to apply for the minor licences are American firms Boyd Gaming, Penn National Gaming and Caesars, Dynam Japan, Cambodian company NagaCorp and Korean enterprise Paradise. The report warns, however, that some of the big shots could also opt for these licences in spite of the anticipated
lower profits. The two kinds of licences and other details have yet to be decided, as the law has not even reached draft stage. However, the Union Gaming report takes into account professor Toru Mihara’s opinions. Mihara has ‘acted as a gaming advisor to the government for the last 12 years and has been influential in the creation of anticipated gaming policies and regulations’ in Japan, the report indicates. According to the report ‘Japan is hoping to use the Tokyo Olympics in 2020 in tandem with IRs as a means
of driving international tourism’. Union Gaming says that ‘the timeframe is tight and doesn’t leave much margin for any sort of delay’. A little hold-up in the process could result in IR’s not opening for the Olympic date so it is quite probable that the IR Promotion Law outline may be presented as early as next week.
Formula unclear The report also ventures that ‘most likely, a 2+2 formula with 2 big IR licences destined for each of Tokyo and Osaka, and up to 2 small
IR licences destined for any number of smaller markets, including municipalities or prefectures that have already expressed interest like Hokkaido, Nagasaki, Nagoya and Okinawa’ will be the order of the day. Some details are still quite opaque; it is not clear if a local partner will be compulsory for an application, and it also ‘remains unclear’ if a singular IR operator will be able to hold more than one licence. ‘One city, one licence’ seems a likely scenario but the report casts doubts about it. O.G.
May 9, 2014
Dark Thursday Macau casino stocks dropped a record 9 percent yesterday boosting the already record volatility in the industry this year. The stream of recent negative news - like the crackdown from authorities on illegal money transfers and visas, junket scandals and the economic slowdown on the mainland – is seriously disquieting investors. Markets are ‘overblowing’, analysts say. Alex Lee
t was a dark Thursday for casino investors. All five major gambling operators in Macau saw their shares plummet almost 10 percent in a single session yesterday in Hong Kong with investors concerned that less gamers will come to Macau this year given the tightening of visa rules, the crackdown on illegal money transfers and defaulting junkets. Most affected by investors’ panic yesterday were Galaxy Entertainment and MGM China, both falling 9 percent, with GE recording its biggest drop in two years. Wynn Macau’s shares lost 8.7 percent – also a two-year record - while Sands China dropped 8.4 percent and Melco Crown Entertainment suffered it’s biggest fall on a session since its listing in 2011, losing 8.4 percent. The ‘winner’ was SJM Holdings, whose
shares tanked 7.5 percent. The flow of negative news coming out of Macau in the last few days has taken its toll on casino stocks, despite the industry’s solid fundamentals on display this year with operators reporting profits climbing from 30 to 50 percent in the quarter. Investors have also been upgrading their outlook for 2014 casino revenue performance. “The stream of negative news these last days is being overblown by the market”, Christopher Jones of Telsey Advisory Group told Business Daily. “Macau is building bridges, metro and casinos to attract more gamblers and at the same time will restrict visa policies? It doesn’t make sense. We’re seeing a lot of speculation and no confirmation”, added the analyst. The authorities’ crackdown on
Wynn Macau (HK)
visas and illegal money transfers were the main drivers of yesterday’s share dive. South China Morning Post said that Macau police had seized China Union Pay mobile card-payment devices that were allegedly being used to skip China currency controls and several media outlets reported that visa rules affecting mainland visitors will be tightened, putting investors with casino share concerns in a sell-off frame of mind.
Clarity essential These events join a set of others which have unfolded in recent weeks like the uncertainty of the impact of China’s economic slowdown on Macau and the HK$10 billion default and ponzi scheme set up by a junket cooperating with one of the biggest operators in the territory.
Yesterday’s dark session in Hong Kong only served to boost the already increasing volatility of casino stocks, which became apparent at the beginning of the year with steep declines and jumps. “We had some weak month starts this year like April and second quarter results will be more moderate because last year’s second quarter was very good”, says Christopher Jones. Telsey believes that in the coming months the market will see more “clarity” in the situation and sessions like yesterday’s will probably be more unlikely. “For example, people are freaking out over the VIP slowdown this year but as casinos are moving more tables from VIP to mass market, that’s a normal thing, there’s no reason to stress”, Telsey’s analyst told Business Daily.
MGM China (HK)
38 34 36 32 34 30 32 28
Galaxy Entertainment (HK)
Sands China (HK)
Melco Crown (US)
27 50 26 45
May 9, 2014
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HOSPITALITY Standing still The activity of travel agencies has increased noticeably with the region’s economic boom. In one area, though, they have struggled just to keep pace. We’re talking here about the number of guests introduced to hotels by travel agencies. The number of hotels, the number of rooms and the number of guests have all risen significantly. At the same time, the amount of guests channelled through travel agencies has hardly changed. The occasional jump over the 1 million mark notwithstanding, their quarterly average for the last three years stands mostly within a narrow band of around 980,000 guests. As a result, the agencies’ share of the total number of guests dropped from values above 45 percent in the earlier part of the period, to figures well below 40 percent in the last six quarters.
Small real estate agencies are struggling to survive with the new law, considering tighter regulations
Recruiting agents a major headache, say agencies Most of the guests were directed to 5-star hotels. Their number rose by almost 50 percent between the first quarter of 2010 and the same quarter this year. Their share of the total rose from less than 38 percent at the beginning of the period shown to current and recent values that account for around half of the total. Conversely, the shares for lower category hotels have declined. In the case of 4- and 3-star hotels the losses have been slow but steady, amounting to 6 percent and three percent, respectively. But the share of 2-star hotels has sharply declined by almost a half in these years. Were it not for their very small numbers, guesthouses would be the stars here, with a 130 percent rise. They are almost invisible in the plot, however, as their quarterly average in the period represented stands at just about 4,000 guests. J.I.D.
proportion of hotel guests introduced by travel agencies, Q1
It is getting more difficult to hire agents since the entry into force of the Real Estate Agency Law, according to the bigger real estate agencies in the territory. The smaller ones are finding it difficult to survive and hope the government will amend some of its clauses Luciana Leitão email@example.com Photos by Manuel Cardoso
he biggest real estate agencies in the territory applaud the Real Estate Agency Law but complain about difficulties in recruiting staff that complies with some of the diploma requirements, while the smallest ones say they are struggling to stay afloat. As a result, not even one year has passed since the law came into effect but the government is already approving amendments. Last July, the Real Estate Agency Law entered into force. Some of the main changes in the law address the need for real estate agencies and agents to be licensed after passing relevant government examinations, and the requirement that all agents must have completed senior high school. Also,
according to the law, real estate agents can only begin to represent clients after signing a written agreement with them. Small agents were especially unhappy with the requirement stated in the law that all property brokerage shops are to be situated inside commercial premises, as well as the regulation that all real estate agents must wear a badge displaying his/her name and licence number as well as their agency’s designation and licence number. The Executive Council has now suggested revising the Real Estate Agent Law by offering five-year temporary permits to real estate agents running businesses in illegal venues located in residential or industrial
buildings, before the entry in force of the law, following which they have to move to commercial areas or won’t be issued the government licence. Despite agreeing with the law, Ricacorp Macau managing director Jane Liu Zee Ka says that there are some clauses that have been responsible for a few headaches. “We need the landlord to fill in a form if we want to rent [or sell] the house, so even though most of the landlords have been willing to do this, some don’t”, she says. And when that happens, according to the law, the agencies are not allowed to advertise the property. “If the owner doesn’t sign, we cannot promote the property.” Another fly in the ointment is that
May 9, 2014
The managing director of Ambiente Macau, Suzanne Watkinson, says the law has brought some changes in the way they operate, mostly in what concerns paperwork.
Paperwork is time consuming, and although we explain to clients that we’re expected by law to have them sign agency agreements with us indicating the properties we show them before we show them, some are irritated/affronted Suzanne Watkinson Managing director of Ambiente Macau
landlords are already requesting a discount on the commission paid to the agency before signing the agreement. “Before this law, they wouldn’t do that - agents need an income; we also need to run a company”, she says. Ricacorp has also been having a few problems recruiting agents due to the law’s requirements. She says that some of the agents have skipped secondary school but have a higher education degree, but, as such, they cannot apply for a licence. “I think this needs adjustment. This clause should be more flexible, if they have a higher education degree”, she says.
Less conflict and fraud The chief executive officer of Midland Realty Macau, Ronald Cheung Yat-fai, believes that the law has ushered more transparency into the business and reduced the number of disputes over certain issues. “Currently, everyone knows the law, so it has reduced a lot of disputes, especially in the rental cases. Most agents have a better understanding of the property law and know better how to deal with some tricky transaction issues”, he says. As a whole, the quality of the agents has improved and he has stopped hearing about “fake real estate agencies” engaged in property agency work. However, Midland has been experiencing some problems with the
enforcement of some clauses of the law, particularly the ones that force the property owner and potential clients to sign a form beforehand. “Most of the time, locals are reluctant to sign. Some owners say they will only sign when they have an interested client”, he says. Also, he says they’ve been having problems in recruiting people that comply with the requirements of the law. “Nowadays, the entry level has been raised so much because newcomers have to pass the secondary level and also a special examination”, he says. On the up side, he says, overall the law better protects the owner, the buyer and also the agents. “Sometimes, we have strangers coming to our shop saying they are the owners of a house but we don’t know for sure. Now they need to sign a form”, he says. As a result, he believes fraud cases have been reduced. As for any impact such regulations may have had on the property market itself, Mr Cheung doesn’t see it. “Maybe more or less it has had an indirect impact because the market changed with the several cooling measures issued by the government.” The director of JML Property, Juliet Risdon, says the law hasn’t affected her company’s activities at all, as most of the regulations added referred to practices that JML Property has implemented over the years. However, she still thinks other regulations are needed regarding this matter, namely on what concerns the real estate agency commission on transactions. “It would be nice to have the Macau General Association of Real Estate issue some guidelines in regard to the minimum percentage of commission and guidelines about commission overall”, she says. At her own firm, the managing director of Ambiente Macau, Suzanne Watkinson, says the law has brought some changes in the way they operate, mostly on what concerns paperwork overload. “Paperwork is time consuming, and although we explain to clients that we’re expected by law to have them sign agency agreements with us indicating the properties we show them before we show them, some are irritated/affronted - and refuse to sign”, she says. Overall, she believes regulating the real estate industry in Macau is a positive move. Yet, Ms Watkinson believes the sector needs a couple of other things to become better regulated, such as an independent body similar to the Estate Agents Authority that exists in Hong Kong, where agents, tenants/buyers can seek advice in Chinese, Portuguese or English. Also, considering her company mostly deals with foreigners, she adds a recommendation: “Documentation needs to be available in English.” And the same can be said regarding the lessons about the law before taking the real estate agent examination, that needs to also be made available in English. Finally, she believes “there needs to be more clarity on penalties and how practitioners can be protected in cases when clients fail to adhere to agreements.”
Struggling for air Rose Neng Lai, assistant professor in Economics at the Faculty of Business Administration at the University of Macau, says such a law comes to “better regulate the quality of real estate agents” but might end up driving out small real estate agents. In fact, according to her knowledge, many of those who are actually now working as real estate agents in the territory are people who couldn’t find a job in a company. A local small real estate agent that works in partnership with other firms,
who declined to be named, says small companies are really suffering from the law. “With the changes in the law, I must have a shop or an office. But no-one needs to have an office, since we’re showing apartments.” Our source has been working part-time as a real estate agent and had her home address defined as her office address for many years. “I had to change it and put my friend’s address.” Also, our source says that small agents are having problems in complying with asking the owner to sign an agreement. “They usually don’t want to disclose personal data, like who they are married to; they don’t want to give a copy away to some agent they just met”, our source says. And, when that occurs, agents are not allowed to advertise the property, yet our source says they do it anyway. Another thing small agents are complaining about is the content of the official examination they need to pass to receive the licence. “Some of these questions, not even a lawyer can understand them.”
Clearer and safer environment Leanda Lee is a property owner in Macau used to transacting with real estate agents in the territory. She believes that the law removed “uncertainties” and offers “clarity on what to expect from agent services”, giving landlords and tenants a “sense of security”. It eliminates that “time consuming vetting process” of looking for “reputable” agents. Since the law entered into force, as a landlord Ms Lee hasn’t noticed any big changes in their working relationship.
The chief executive officer of Midland Realty Macau, Ronald Cheung Yat-fai, believes the law has brought more transparency to the business and reduced the number of disputes. Midland Realty Macau has been having some problems with the enforcement of some clauses of the law, particularly the ones that force the property owner and potential client to sign a form beforehand.
Most of the time, locals are reluctant to sign. Some owners say they will only sign when they have an interested client Ronald Cheung Yat-fai Midland Realty Macau chief executive officer
“But then, we’ve been careful to sign with an international brand real estate agent who was recommended by the internationally branded management company of the apartment that we bought”, she explains. However, she expects this law to “imbue in the less sophisticated of Macau agents an understanding that sustainable business practices will not detract from their profitability over time.” One thing she would like to see in the real estate industry is a change from a transactional real estate agent business model to a managing real estate agent business model in which the agent manages the ongoing needs of both parties, namely repairs, maintenance and utility payments. “This would be particularly useful for absentee landlords, of which there are many in Macau.”
We need the landlord to fill in a form if we want to rent [or sell] the house, so even though most of the landlords have been willing to do this, some don’t.” And when that happens, according to the law, the agencies are not allowed to advertise the property Jane Liu Zee Ka Ricacorp Macau managing director
Numbers lead to changes The Housing Bureau says that up to April 22 it has provisionally licensed 1,485 estate agencies and 4,538 estate agents but it has refused to license nearly 40 agencies or agents because they work out of residential buildings or other premises not zoned for business use. A spokesperson for the Executive Council, Leong Heng Teng, admitted it was because “many of the agents didn’t get licences” that the government has decided to change the Real Estate Agency Law, allowing them to continue operating temporarily for five more years.
May 9, 2014
MGTO strolls down memory lane Macau Government Tourist Office hopes to identify the unique characteristics of each district – namely, via the walking trails - to encourage visitors to stay awhile Tony Lai
he government aims to poll residents and businesses to identify the different characteristics of districts where the four new tourist walking trails are located, in order to induce tourists to linger longer in Macau. The survey will also consult whether complementary facilities like restaurants should be listed in the information on the routes, which will be launched in September, the Macau Government Tourist Office said. A consultation period kicked off yesterday on the four new routes covering the territory’s northern district, west of the Ruins of St Paul’s, Taipa and Coloane. MGTO will hold six explanatory sessions until May 18, while in-street and online polls of residents and businesses will run from May 19 to June 19. The four new walking trails serve as an addition to the four existing routes
launched last September to divert tourists to other parts of the city from crowded tourist spots. Macau received 10 percent more visitors in this year’s first three months to 7.69 million. MGTO director Maria Helena de Senna Fernandes said yesterday that they will draft a report following the consultation, “hoping” details of the four new routes can be unveiled on September 27, World Tourism Day.
“As we now hope to prolong the length of tourists’ stay and let them explore more new places here, we want to identify [tourism] elements in different districts… which can also boost the economy there,” she said. Official figures show that the average length of visitors’ stay remained flat at 1 day as of March. “We’ve actually been planning since numerous years ago to bring out the unique
characteristics of each district here, the characteristics that can appeal to tourists,” Ms Senna Fernandes noted. Thus, the administration is particularly polling the residents and businesses in the four districts via in-street interviews as “they know their districts the best”, she said. The four routes launched last year, however, have not received enthusiastic responses from the public or tourists. The administration
has been slammed for offering no clear indicators or information to tourists for the facilities along the routes. Asked whether the information for the four new routes will include other facilities like restaurants and retail stores, Ms Senna Fernandes responded that it depends on the opinions collected in the consultation. But she said it is “difficult to include all information” and some businesses may feel it not fair if theirs are not listed. The administration at the moment also does not have real figures to assess the effectiveness of the routes, even though four trails were launched at the end of September, the director admitted. But they will start an incentive scheme in the summer like gifts in exchange for collecting a certain number of stamps along the routes in order to appeal to tourists and evaluate the effectiveness of the trails, she concluded.
Business Awards announces new categories for 2014
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The second edition of the Business Awards of Macau continues to promote the best achievements of companies and individuals that have made exceptional contributions toward the development of Macau. This year, the programme honours two new categories. The new categories include “New Talent” and “Most Valuable Brand”. The addition of these categories sets the stage for the Awards to embrace more professionals and companies and also gives an opportunity for organisations to recognise their staff. In addition, last year’s “Woman Entrepreneur” category has been merged with the new “Entrepreneur” category. It will now cover both female and male professionals. The category of “New Talent” will award individuals who have natural skills or abilities for achieving success at a particular duty or area of responsibility within an organisation. Through this category, the Business Awards has opened up an opportunity for organisation founders and/or top executives to identify talented individuals within their staff. The award of “Most Valuable Brand” will go to an outstanding brand that has reported significant profit and business growth during the previous financial year. The brand can have been created locally, or it can be an international franchise with local partners or an international company based in Macau. The category of “Entrepreneur” acknowledges individuals who have demonstrated notable entrepreneurial skills and initiative in taking new ideas to the market and making the right decisions to make those ideas profitable through business ventures. There are 10 Award categories in total, which mainly focus on achievements of the nominees over the last 12 months. Companies and professionals are welcome to self-nominate and may submit nominations for a maximum of two categories for consideration. However, one form per category must be completed. Read more detailed descriptions of each Awards category by visiting our website: www.awardsmacau.com New Sponsors Banco Nacional Ultramarino SA (BNU) has recently announced its support of the Business Awards of Macau as a Silver Sponsor. CTM, CEM and ICBC have also joined the event as Bronze Sponsors.
May 9, 2014
Local New prison shackled by businessman labour shortages and terrain invests in Fujian Phase one of the new prison to be ready in August LCD maker Sara Farr
ang Huo Enterprise Group, a local company founded by businessman Ngan In Leng, is investing in Fujian-based liquid crystal display (LCD) manufacturer Guanke Electronic Technology Industrial Co Ltd via a venture capital fund, mainland Chinese media reports. The flat-panel LCD products manufacturer Guanke (Fujian) Electronic Technology Industrial Co Ltd, established in Fujian in 2006, produces LCD panels, smart televisions and tablet PCs. Chairman of Guanke, Mr Ke Shao Chun, said that Macau’s Hang Huo Enterprise Group will be offering advice on reforming the shareholder structure and will help lay a foundation for the LCD maker’s access to capital markets via the group’s venture capital fund, China Daily said. The venture capital fund is focused on investment in the information technology business, clean energy and biotechnology industries, the newspaper noted. Business Daily asked Hang Huo Enterprise Group for more details on its venture capital fund and its investment plan for Guanke but did not receive a reply by the time the story went to press. Hang Huo Enterprise Group, established by businessman Ngan In Leng, runs hotel, entertainment, property and trading companies. The group is currently chaired by Ngan’s son, Ngan Iek. Mr Ngan In Leng is a Fujian businessman who in 1980 migrated to Macau, where he is now resident. He is also a member of the national committee of the Chinese People’s Political Consultative Conference. He was chairman of the defunct Viva Macau Airlines, which was grounded in 2010 over unsettled debts. S.L.
Guinea-Bissau minister found dead in Macau
uinea-Bissau’s infrastructure minister, Rui de Araújo Gomes, was found dead in a Venetian Macau hotel room yesterday. He was in the region to attend the 5th international forum on investment and infrastructure construction. An adviser to the late minister told Lusa news agency that the government official “did not show any signs of illness” when he left the country on the way to Macau. His death was “a big surprise”, said the adviser. A civil engineer by training, with a degree from the former Czechoslovakia Republic, the 61year old minister was a cousin of the former Prime Minister Carlos Gomes, whose government was deposed by a military coup in April 1972.
The new prison towers at a distance
public tender for the construction and structural works of phase two of the new Macau Prison could still be launched within this year, with phase one of the project expected to be ready this summer. So far, phase one of the fourphase project has experienced a great delay mainly due to changes that were required due to the condition of the land. The Public Works Bureau said that some delays in the completion of the foundation works were caused because of the complex characteristics of Ka Ho Hill. In response to an enquiry from Business Daily, the Land, Public Works and Transport Bureau said that currently the contractor is working on a surrounding wall, access road and the building façade. In addition, the structural work on the eight guard towers is almost complete, as is its interior. Bulletproof glass is also being put in around the guard towers. The first phase began in August 2010, while the remaining phases were supposed to take place in the following three years. In July 2012, Lee Kam Cheong, director of Macau Prison, said he “expects” the first of the project’s four phases to be wrapped up before the end of the year, much later than the original projection of February 2012. In November of that same year, he told legislators that the delays were caused by typhoons and problems with the quality of the construction materials. “In addition, due to specific requirements in regard to the
equipment and construction materials… changes to the project were necessary,” the Bureau told Business Daily, adding that the land on Ka Ho Hill made it impossible to carry out piling work. This made it “necessary for the contractor to carry out excavation works to install a box-culvert.”
Delays explained The shortage of labour also brought added problems to the construction of the new prison, delaying phase one of the project. However, the Bureau told Business Daily that estimates point towards the completion of this first phase in August. Should the contractor fail to meet the deadline without prior justification, the Public Works Bureau will impose a fine. By the time Business Daily went to press, the Bureau had not responded to how much this fine might be. However, it will be “according to the contract agreement.” The new prison in Ka-Ho, Coloane, will accommodate up to 2,700 inmates. The contract to build the prison, worth 113.1 million patacas, was signed with Zhen Hwa Harbour Construction Co Ltd in October 2010. The company is a joint venture with state-owned contractor China Harbour Engineering Co Ltd, which owns 51 percent, and gaming company SJM Holdings Ltd. It was amended in March 2012. The following month, the Bureau said that the contractor would be responsible for any additional costs stemming from delays, including the wages of construction workers.
… the land on Ka Ho Hill made it impossible to carry out piling work. This made it necessary for the contractor to carry out excavation works to install a box-culvert Public Works Bureau
In November that same year, the government admitted that the construction of phase one would cost an additional 30 million patacas, around 27 percent more than initially estimated. In response to Business Daily’s enquiry, the Public Works Bureau said the price of this first phase of construction is estimated at around 110 million patacas.
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May 9, 2014
Financial support for social services increases one fifth Funds to fight gambling addiction counter trend in 2013 Overall, in 2013, NGO’s working in several areas have received more than 647 million patacas from the government, an annual increase of 20 percent, representing more than triple the inflation rate. Still, and despite this being a casino city, regular financial support for associations that promote responsible gaming has decreased 42 percent. The support that is sporadically attributed to associations that care for the elderly has also decreased but, according to two academics, that is actually a good sign Fátima Almeida
he total amount of subsidies regularly awarded by the Social Welfare Bureau (IAS) to associations that provide services in several areas increased by 20 percent in 2013 compared to 2012. This increase is 3.6 times the rate of inflation, that reached 5.5 percent in 2013. The government spent more than 647 million patacas, including 556,021,681 patacas on permanent financial support and 90,992,838 patacas in non-permanent support. For non-permanent support, the increase reached 14 percent, according to data provided to JTM by the IAS. Services provided to children, youngsters, the elderly and rehabilitation occupy the first three places in the list of those receiving the most money from the government, with increases ranging from 19.22 percent to 21.62 percent, in 2013. The biggest increase went to associations dedicated to community service, with a jump of 38.36 percent. On the other hand, there was a noticeable decrease in subsidies for institutions that deal with gaming problems, with subsidies falling 42.15 percent to 3 million patacas, in 2013. Overall, the average 20 percent increase in permanent subsidies is “normal”, but it doesn’t mean that the government is bolstering its efforts in, say, social services against inflation. According to Larry So, an important part of the investment was allocated to restructuring associations, supervision works and paying salaries so that the associations could retain employees, something that should have been done ten years ago. “A 20 percent increase is normal because the government has stepped up its financial support of NGO staff salaries and supervision”, said the
Macau Polytechnic Institute (IPM) Social Policies professor. “This investment is justified not only because an inflation-related problem must be resolved but because NGO services need to improve and that should have happened a long time ago. Salaries are very low and, starting last year, the government began increasing them, although meanwhile several staff have since moved into the private sector”, he lamented.
Focus now on long term elderly support Although regular subsidies given to associations that provide elderly care rose by 19.18 percent last year, money for one-off projects went down by 13.71 percent. Despite this drop, both Larry So and Jacky Ho, Saint Joseph University (USJ) Social Services Programme Coordinator, believe these numbers are “a positive sign”. Analysing the statistical data, the academics conclude that the government is more inclined to invest in long term elderly support plans, and that may be more beneficial for future results. Jacky Ho explains that, “it has to do with the government’s ten year policy designed for the elderly, as well as a change in the way this problem is approached, meaning that the need for some non-regular subsidies to become regular has been identified”. The USJ professor believes that this is the correct policy for social support. He adds that, “we can’t continue supporting short term projects and pretend that we’re solving the problem”. The IPM’s Public Administration School professor, Larry So, agrees and says that the drop in temporary financial support “is a good sign rather than a
bad sign”, because “public money should go to long term programmes . . . For short term projects, NGO’s can enjoy funds from other sources. For example, the casinos”. Jacky Ho’s perspective is that the concessionaires have begun to support responsible gaming programmes, which can help explain the regular subsidies decrease, as well as that of the non-permanent subsidies that the government provides to associations assisting in the same area. “The casino industry also subsidises such programmes for their workers. A few years have passed since a dialogue was created on the need for the employers to be more active in promoting responsible gaming, and they want to promote that external image”, the USJ professor said, while noting that the analysis would be clearer if there was access to the operators’ data on their own initiatives. Jacky Ho recognises that the drop of subsidies for gaming addiction prevention is “gigantic” – reaching 84.66 percent in non-regular subsidies -, considering that the NGO’s “have done a good job” but he believes that casino bosses have started listening to their employees’ critical voices and now realise that more support must be provided to them. Nevertheless, the IPM academic offers another explanation. “It’s a big drop but the IAS has changed its policy and pathological support has been transferred to the department that provides drug prevention services”, Larry So explained.
Community service on the up In 2013, community services enjoyed the highest increases in both permanent and non-permanent
financial support, of 38.6 percent and 87.67 percent, respectively, representing 26.5 million patacas and 16.8 million patacas. Although these amounts are much less than those that are permanently provided to institutions dealing with children (158.5 million patacas), the elderly (127.6 million patacas) and rehabilitation (119.3 million patacas), the community service sector stood out for its increased support in 2013. According to Larry So’s analysis, the reasons behind this have to do with the decision to create integrated services which might enable an association to handle not only youth affairs or family related problems but both because they are related. Looking only at associations that provide family support, the regular subsidies amount rose 30.7 percent to nearly 42.4 million patacas. Still, it represents less than what “solidarity causes” received – 50.9 million patacas. Overall, the government spent more last year with social services associations – adding both regular and non-regular subsidies - but the USJ Social service coordinator points out that the government must not shoulder all the responsibility. Jacky Ho stresses that there’s a need to promote a social service policy in which society plays an integral part, including businesses and investors. “Our population is growing and we must not rely solely on the government. Society must do its part, as well”, says the academic, adding that employers are increasingly more aware of the need to provide services to their workers because if they do nothing they’ll be targeted by complaints and their external image will be negatively affected. He concludes that “Macau is very small and currently trying to connect itself to the international world. We have to follow the world trends because criticisms will follow if we don’t. The dialogue between the government, employers and employees is increasing and it all has to do with the NGO’s work”. Exclusive JTM/Business Daily
5,684 families receive financial support from the IAS Last year, the IAS helped 246 families fewer than in 2012, providing financial support to 5,684 families, for a total of 9,880 individuals. The decrease, according to Larry So, is related to the unemployment rate drop, while another factor that may help explain it is the variation in the inflation rate. Still, the decrease of subsidies given to families does not mean that people “are richer”, the IPM academic believes, underlining that, on the contrary, many cannot pay all their expenses with the salaries they earn.
May 9, 2014
Greater China HK Stock Exchange profits rise
Trade figures beat predictions
Hong Kong Exchanges & Clearing Ltd, the world’s sixth-largest exchange operator by market value, posted an 2 percent rise in net profit yesterday, helped by a rise in new listings. HKEx posted first-quarter net profit of HK$1.18 billion (US$152.22 million), up from HK$1.16 billion a year ago. The number of new listings in HKEx doubled to 20 in the January-March quarter, raising HK$112.4 billion, while average daily turnover of equity products fell 5 percent to HK$55.1 billion.
The government has set a target of 7.5 percent growth for exports and imports this year
Low-cost medicines price cap removed The retail price cap of low-cost medicines in China will be scrapped to revive dampened production caused by weak profits and ensure supply of essential drugs, the country’s top economic planner and regulator announced yesterday. Restriction on maximum prices of 280 Western medicines and 250 Chinese patent drugs, previously priced low by the government to relieve patients’ medical burden, will be lifted, allowing producers to set prices according to their production costs, according to the National Development and Reform Commission (NDRC).
Senior official dismissed from CPC for graft A former senior official from southwest China’s Guizhou Province has been expelled from the Communist Party of China (CPC) and dismissed from public office, said the CPC discipline inspection agency here yesterday. Investigations found that Liao Shaohua, a former Standing Committee member of the CPC Guizhou Provincial Committee and party chief of Zunyi City, used his positions to seek profits for others and accepted bribes, said a statement from the Central Commission for Discipline Inspection (CCDI) of the CPC. He abused his power and caused serious loss of state property, the statement said.
Copper and iron imports rise China’s imports of copper rose to 450,000 tonnes in April, up from 420,000 tonnes in March, customs data showed yesterday. Arrivals of copper anode, alloy, refined metal and semi-finished copper products were up 7.2 percent from the previous month. China imported 83.39 million tonnes of iron ore in April, up 12.75 percent compared with the previous month, data from the customs authority showed yesterday. Imports for the first four months reached 305.3 million tonnes, up 21 percent on the year, the data showed.
PBOC to drain 60 billion yuan repos China’s central bank will drain 60 billion yuan (US$9.6 billion) from the money markets through 28-day forward bond repurchase agreements on Thursday, traders said, meaning it will drain a net 60 billion yuan from the markets this week. The People’s Bank of China (PBOC) conducted a net injection of 91 billion yuan into the market last week.
hina’s exports and imports unexpectedly rose in April, helping leaders put a floor under a slowdown in the world’s second-biggest economy. Overseas shipments increased 0.9 percent from a year earlier, when figures were inflated by fraudulent invoicing, data from the Beijing-based customs administration showed today. That compared with the median estimate for a 3 percent drop in a Bloomberg News survey of analysts. Imports gained 0.8 percent, leaving a trade surplus of US$18.46 billion. Improving global and domestic demand would reduce chances that Communist Party leaders resort to broad-based monetary easing or largerscale stimulus than railway spending and tax breaks, after first-quarter growth slowed to the weakest pace in six periods. Officials are trying to rein in credit, pollution and property prices while targeting annual expansion of about 7.5 percent this year. “Growth will probably stabilize in the second half as credit conditions get better, and external demand will further improve,” Ding Shuang, senior China economist at Citigroup Inc. in Hong Kong, said before today’s release. “Export and import growth will boost economic growth.”
Data distortions China’s trade data have been distorted this year after figures in early 2013 were inflated by falsified invoices used to disguise capital flows, triggering a government crackdown on the practice. April may mark the final month of the distortions and May data will compare with what Royal Bank of Scotland Group Plc economist
Louis Kuijs says were “pretty clean” numbers in the same period last year. April exports have shown “obvious improvement,” Zheng Yuesheng, spokesman for the customs administration, said on state television today. “The external environment for China’s foreign trade is improving,” Zheng said. “The effects of an inflated comparison base in the same period last year are weakening.” Exports fell 6.6 percent in March from a year earlier and plunged 18.1 percent in February, the biggest drop since the global financial crisis, based on previously released data. Estimates for April from 47 economists ranged from a drop of 7.5 percent to an increase of 3.6 percent.
Imports estimate Imports compared with a median estimate for a 2.1 percent decline
from analysts surveyed by Bloomberg News, with forecasts ranging from a drop of 11 percent to an increase of 5.8 percent. The trade surplus was projected to be $16.7 billion. China will implement measures to stabilize the country’s “severe and complicated” foreign-trade situation, the cabinet said last week. The government will accelerate the development of cross-border e-commerce, streamline trade processes, reduce the types of merchandise that require inspection and improve trade financing, according to a State Council statement. Policy makers’ efforts to rein in credit, pollution and property prices are projected to help push down annual expansion to a 24-year low. The economy will grow 7.3 percent this year, according to the median estimate of 57 analysts surveyed in April. Finance Minister Lou Jiwei reiterated this month that the nation won’t use short-term, large-scale stimulus. China will support growth through measures including deregulation and the development of service industries, Lou said at a meeting of Asian finance ministers and central bankers in Kazakhstan. The government has set a target of 7.5 percent growth for exports and import this year. China missed its growth targets of 8 percent in 2013 and 10 percent in 2012, and some analysts and officials think this year’s target will also be tough to reach. China’s economy grew at its slowest pace in 18 months in the first quarter, and a Reuters poll shows analysts expect growth of 7.3 percent in 2014, the weakest in 24 years. Bloomberg News and Reuters
HK property tycoons trial starts The Kwok brothers could spend more than HK$100 million in legal fees
homas and Raymond Kwok, the billionaire co-chairmen of Sun Hung Kai Properties Ltd , Asia’s largest developer, went on trial yesterday in Hong Kong’s biggest corruption case since the city’s anti-graft agency was formed nearly 40 years ago. The case involves a series of payments and loans totalling more than HK$35 million (US$4.5 million) allegedly paid to Rafael Hui, who had headed Hong Kong’s civil service from 2005 to 2007. The three men have pleaded not guilty to all charges, including conspiracy to offer an advantage to a public servant. The case has thrown a spotlight on the close relationship between the city’s powerful developers and government in the former British colony, which returned to Chinese rule in 1997 and has a separate legal system from the mainland. The Kwok brothers, who run the world’s second-largest property company with a market capitalization of US$34 billion, have been charged with a total of seven offences, including claims related to alleged
payments offered to Hui. Thomas Chan, a board member in charge of land purchases at Sun Hung Kai Properties, and Francis Kwan, a former Hong Kong Stock Exchange official, have also been charged in the case. They have also pleaded not guilty. All five defendants appeared in court, where about 50 photographers and cameramen jostled to get shots of the men at the entrance. Thomas Kwok, wearing a black suit and red tie, thanked reporters as he entered the court looking relaxed.
Sun Hung Kai Properties market capitalization
Thomas Kwok, co-chairman of Sun Hung Kai Properties Ltd., arrives at the High Court in Hong Kong yesterday
The prosecution and defendants have hired high-profile lawyers for the trial, with local media reporting the Kwok brothers could spend more than HK$100 million in legal fees, which would mark the most ever paid in the city. Clare Montgomery, a specialist in criminal and fraud law, is representing Thomas Kwok. She led the prosecution team in the extradition case to Sweden of Julian Assange, founder of whistleblower website WikiLeaks. John Kelsey-Fry, a lawyer who represented former News Corp. executive Rebekah Brooks in a phone-hacking scandal, is defending Raymond Kwok. Hong Kong’s Court of First Instance will summon more than 80 witnesses during the trial, which is scheduled to run for 70 days. Reuters
May 9, 2014
Asia CIMB Thai Bank cuts 2014 loan target CIMB Thai Bank, a unit of Malaysia’s CIMB Group Holdings Bhd, has cut its 2014 loan growth target to 10-15 pct from 15-20 pct due to Thailand’s weak economic outlook and the impact from political unrest. The bank’s loans grew only 1-2 percent in the first quarter and the loan growth should accelerate in the second half, driven by demand from large corporate clients, Chief Executive Subhak Siwaraksa told reporters yesterday.
Toshiba bids for Alstom unit The firm will offer to buy Alstom’s power grid business for “several hundred billion yen” if General Electric Co completes its planned purchase of Alstom’s energy business, the Nikkei newspaper reported. GE has offered to buy Alstom’s energy business, which makes power generation systems along with power grids, for about US$16.9 billion. The French company said last week it was reviewing GE’s offer but has also given Germany’s Siemens AG until the end of May to make a rival bid. A spokesman for GE declined to comment on the Nikkei story.
S.Korea April FX reserves rise South Korea’s foreign reserves rose US$1.5 billion in April to a fresh record high, central bank data showed yesterday, as management gains added to the stockpile. The Bank of Korea said the foreign reserves, 91.6 percent of which are in the form of securities, stood at US$355.85 billion at the end of April compared with US$354.34 billion at end-March. Part of the gains were also attributed to the appreciation of some currencies, including the euro and sterling, which rose 0.5 percent and 1.1 percent against the greenback, respectively. As of the end of March, South Korea had the world’s seventh largest foreign reserves.
Qantas to cut debt
Australia’s Qantas Airways Ltd said yesterday it plans to cut debt by over A$1 billion (US$935 million) by fiscal 2015 to achieve positive free cash flow. Qantas, which has been hit by fierce competition, plans to reduce debt by simplifying its fleet, scaling back investment and selling assets, it said in a presentation at the Macquarie investment conference in Sydney. It also said it expected to cut gross debt to less than four times of adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) by fiscal 2017.
Samsung SDS plans IPO this year The IT solutions affiliate of South Korea’s Samsung Group, yesterday said it is planning an initial public offering this year, joining other global technology firms seeking to tap strong investor demand. Samsung SDS said it would select IPO lead managers this month and decide the size of the share offering, in a deal that may benefit top shareholders such as Samsung Electronics Co Ltd and Samsung Electronics Vice Chairman Jay Y. Lee. The plan signals an accelerating restructuring in Samsung Group as its founder and owner family prepares to hand over control of South Korea’s biggest conglomerate to the third generation.
Unrest drags down Thai consumer confidence Months of anti-government protests in Bangkok have led to a drop in investment and tourists
onsumer confidence in Thailand fell to its lowest in over 12 years in April as a protracted political crisis that culminated in the removal of the prime minister this week took its toll on Southeast Asia’s secondlargest economy. There appears little chance of confidence recovering any time soon given the uncertainty over what will happen next in Thailand’s febrile politics. Months of anti-government protests in Bangkok have led to a drop in investment and tourists, while adding to worries among manufacturers already suffering from weak exports. The University of the Thai Chamber of Commerce’s consumer confidence index fell to 67.8 in April from 68.8 in March. It has fallen for 13 months in a row and stands at its lowest level since November 2001. In addition to the political unrest, the university listed weakness in exports and rising living costs as negative factors, along with the failure of the government to pay hundreds of thousands of farmers for rice it has bought from them. Thailand has had a caretaker government with limited powers since December, when then Prime Minister Yingluck Shinawtra dissolved parliament and called a snap election. However, the vote in February was
Ousted prime minister Yingluck Shinawtra
disrupted and subsequently annulled. Yingluck was found guilty on Wednesday of violating the constitution and had to step down. She had agreed a July 20 date with the Election Commission for a new election but it is unclear if that will go ahead. “There’s still no sign of a pickup in the economy. Consumer confidence continued to weaken although the pace of the fall this month was not that big thanks to higher spending during the Songkran festival,” Thanavath Phonvichai, an economics professor at the university, told a briefing, referring to a holiday for Thailand’s new year. “We expect consumption to remain
weak, at least to the end of the second quarter. Any recovery in confidence will depend on some clarity in the political situation,” he added. Domestic car sales tumbled nearly 47 percent in March from a year earlier. That partly reflected high sales early in 2013 thanks to a government subsidy for first-time buyers, but the troubled political climate has also deterred buyers. Top convenience store chain CP All said last week that because of the political situation it expected sales to grow only 10 percent in 2014, below the average of 12 percent in recent years. Reuters
Vietnam businesses to get ready for AEC market When AEC takes effect, Vietnamese companies will face strong pressure from big companies in regional countries
xperts at a conference in Vietnam’s southern Ho Chi Minh (HCM) City advised local businesses to take the initiative in developing business strategies so they can prosper in the ASEAN Economic Community (AEC) market, expected to be effective in 2015. The conference, themed “ImportExport Coordination Solutions on the Threshold of ASEAN+”, noted that Vietnam’s export turnover to ASEAN in 2013 stood at US$18.5 billion, a year-on-year increase of nearly 7 percent, reported Vietnam News daily yesterday. When AEC becomes effective, local companies would be able to widen markets in ASEAN as well as other countries such as South Korea and Japan, but there would
also be challenges. Growth in Vietnamese exports to this market had been unstable and the potential remained underdeveloped. No product had shown continuous growth in export value, and there were also risks of anti-dumping lawsuits, said Huynh Van Minh, chairman of the HCM City Union of Business Association, at the conference. According to the Ministry of Industry and Trade’s export-import department, Vietnamese exports contained few high value-added products, and the country still had an underdeveloped support industry. When AEC takes effect, Vietnamese companies will face strong pressure from big companies in regional countries, and as such, need to be more proactive when they develop
their business plans. Failure to meet demand for information on origin of products is another challenge for local companies. To improve competitiveness, companies were advised to exploit their strengths so they can take advantage of tax incentives under AEC. Experts also advised local firms to update and forecast changes in the world market, and improve the localization rate of products and the support industry in the country. They should better manage risks, such as buying insurance, and work together closely and invest and widen their business. Furthermore, new technologies such as green technologies should be purchased. Xinhua
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May 9, 2014
Aussie employment rate keeps on surprising The clear improvement in the labour market will be welcomed by the Reserve Bank of Australia that again kept rates on hold this week
obs growth outpaced expectations for a third month running in April and helped keep the jobless rate from rising, further evidence that unemployment may have peaked far earlier and lower than even optimists had assumed. The local dollar climbed a quarter of a cent after the Australian Bureau of Statistics reported 14,200 new jobs were created in April, double market forecasts. That followed an upwardly revised 22,000 gain in March and brought net hiring so far this year to a healthy 106,500. The pick up in hiring helped hold the jobless rate at 5.8 percent when analysts had looked for it to tick up, adding to hopes that the 6.0 percent high hit earlier this year might have been the top for this cycle. “The labour market is increasingly confirming those earlier signs of a peak in the unemployment rate and turn-up in jobs growth,” said Michael Blythe, chief
Certainly, the clear improvement in the labour market will be welcomed by the Reserve Bank of Australia (RBA) which again kept rates on hold this week in expectation that past cuts were working to re-energise the economy. The futures market has already priced out any chance of another easing and been toying with the idea that the next move would be up, albeit not until 2015. Annual jobs growth of 0.9 percent in April was still short of the 1.5 percent pace needed to absorb new entrants into the workforce, but up from almost zero in mid-2013. Forward-looking indicators of labour demand suggest further gains lie ahead. Reuters
KEY POINTS Employment up 14,200 in April, double market forecasts
Pictured: Australian Bureau of Statistics reported 14,200 new jobs in April
economist at Commonwealth Bank of Australia. Normally such a solid jobs report would be good news for a government, but this just makes it harder for the ruling Liberal National party to sell the need for a harsh budget of unpopular spending cuts
and tax rises, due on May 13. Attempting to justify the fiscal pain Treasurer Joe Hockey has warned of a budget “emergency”, even though Australia’s net debt is one the lowest among developed nations and it has the safest of triple-A credit ratings.
“For the budget, if the labour market is improving it will help hold down government spending and boost government revenue, an earlier turn in the labour market is positive news for the budget bottom line,” noted CBA’s Blythe.
Jobless rate holds at 5.8 pct, when 5.9 pct expected Possible peak for unemployment, but tough budget a danger
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May 9, 2014
International Pentagon contracts lifted in April
Barclays to axe 19,000 jobs
Contracting specialists said the boost was an anomaly rather than an indication that military spending is rebounding
Britain’s bank will axe 19,000 jobs in the next three years and set up a “bad bank” to house much of its investment banking business and European retail operations as it strives to turn itself around in the face of a trading slump. Chief Executive Antony Jenkins has taken a knife to Barclays’ investment bank, once the group’s profit engine, after a slide in revenues, a string of senior departures and a row with shareholders over bonuses. Under the latest strategic review, Barclays will cut 7,000 jobs from the investment bank and park some 90 billion euros worth of riskweighted assets from the division in a bad bank.
US$17.8 billion submarine contract, the biggest weapons deal announced by the U.S. military in more than a dozen years, kept Pentagon awards from sinking last month. The contract to General Dynamics Corp. and partner Huntington Ingalls Industries Inc. had been stuck in limbo during Congress’s budget squabbles last year. It was freed up when the president signed a US$1.1 trillion spending bill in January, letting the Defense Department begin funding new projects again. April’s awards rose 84 percent to US$35 billion from US$19 billion a year earlier, according to data compiled by Bloomberg. Contracting specialists said the boost was an anomaly rather than an indication that military spending is rebounding. “This is more of a one-shot deal,” said Mark Amtower, a partner at Amtower & Co., a Clarksville, Maryland-based consulting firm specializing in government contracting. The five-year agreement for 10 Virginia-class submarines, announced April 28, is the Navy’s biggest-ever shipbuilding contract, according to Rear Admiral David Johnson, program executive officer for submarines. It’s also the biggest weapons contract announced by the military since the Navy in October 2001 awarded a US$19 billion, 11-year contract to Bethesda, Maryland-based Lockheed Martin Corp. for F-35 jets, according to data compiled by Bloomberg Industries analyst Brian Friel. The aircraft is the Pentagon’s most expensive weapons system.
Budget cuts Last month’s contracts dropped less than 1 percent from US$35.1 billion announced in March, according to Defense Department data. The Pentagon is required to announce contracts of at least US$6.5 million. Without the submarine agreement,
The five-year agreement for 10 Virginia-class submarines (like the pictured one) is the Navy’s biggest-ever shipbuilding contract
the value of April’s Pentagon contracts would have trailed the US$19 billion announced in the same month last year and would have been less than half the amount awarded in March. On a year-to-year basis, the value of announced contracts has fallen in each of the four months before April. Awards in April 2013 were affected by the start of automatic federal spending cuts under the process known as sequestration. Some of those planned reductions were eased for fiscal 2014 and 2015. “We don’t know what the sequestration outlook is after 2015, and big contracts like the shipbuilding contract give a false impression of stability,” said Loren Thompson, a defence industry consultant and an analyst with the Lexington Institute, an Arlington, Virginia-based research organization.
Political environment The submarine agreement was among several big contracts put on hold while the U.S. government operated under a temporary spending bill from October 2013 to January 2014. The stopgap measure funding the government prevented federal agencies from beginning new projects. General Dynamics and subcontractor Newport News Shipbuilding, now part of Newport News, Virginia-based Huntington
Ingalls, already have built 10 Virginiaclass subs together. Work on the new subs will be done in Newport News; Groton, Connecticut; Quonset Point, Rhode Island; Sunnyvale, California; and other locations. Matt Mulherin, president of Newport News Shipbuilding, called the submarine contract “great news,” particularly in light of “today’s challenging economic and political environments.” The second-largest defence contract last month went to Express Scripts Holding Co. The pharmacy-services agreement is valued at as much as US$5.36 billion, with seven one-year options after the initial 12-month base period. The Tricare health-care deal was announced April 18. Express Scripts will operate military drug stores, fill prescriptions by mail and manage benefits, among other duties, for 10 million Tricare beneficiaries. The St. Louis-based company has provided pharmacy services for the military since 2003. “This award reaffirms the Express Scripts business model that aligns client and beneficiary interests with our commitment to control costs, drive out pharmacy waste and improve health outcomes,” George Paz, chairman and chief executive officer of Express Scripts, said in a press release. Bloomberg News
Drilling bonanza in Morocco The North African country has made no significant discoveries to date, importing virtually all its energy needs and battling to reduce its unaffordable oil subsidies
orocco is enjoying an oil and gas drilling bonanza, with 27 wells planned this year, a senior energy official said on Wednesday, amid growing foreign interest in the kingdom’s potential offshore reserves. “In 2013 and 2014 we have witnessed an unprecedented period of growth” in upstream activity, Amina Benkhadra, the head of Morocco’s Office of Hydrocarbons and Mining (ONHYM), told an energy conference in Marrakesh on Wednesday. This includes a vast amount of seismic data being gathered, and 27 wells being drilled this year in the onshore and offshore, compared with four in 2013, she told hundreds of industry representatives. The North African country has made no significant discoveries to date,
importing virtually all its energy needs and battling to reduce its unaffordable oil subsidies. But improved offshore drilling technology, a benign investment climate and similar geology in prospective regions elsewhere in the Atlantic, like Canada’s Nova Scotia, are encouraging companies to search for Morocco’s potential subsea riches, oil executives say. There are now 34 oil companies operating on 131 exploration and five reconnaissance permits, Benkhadra said, when 15 years ago the country had just a handful of foreign partners exploring for oil and gas. Reflecting the industry’s growing interest in Morocco and boosting the government’s hopes, Chevron and BP arrived last year, joining the two other major players in the upstream,
Repsol and Total. Chevron is due to start seismic shooting next week on acreage it acquired off the coast of Agadir, while drilling kicked off in March at one of the three deep-water exploration blocks that BP farmed into. Other smaller oil firms active in the exploration frontier country include British-based explorers Cairn Energy and Gulfsands Petroleum, Turkey’s Genel Energy and Texasbased Kosmos Energy, which found the Jubilee oil field off Ghana. Kosmos, which sold stakes to BP in three of its offshore blocks, also has acreage in the waters of the disputed Western Sahara, where it plans to sink a well later this year or in early 2015, despite objections by the proindependence Polisario Front. AFP
German industrial output down in March Industrial production shrank in March, hit by falling activity in the manufacturing and construction sectors, data showed yesterday. According to regular data compiled by the economy ministry, industrial output fell by 0.5 percent in March, after rising by 0.6 percent in February. Manufacturing output slipped by 0.4 percent and construction output was down by 2.2 percent, while energy output rose by 1.8 percent. Taking the period from January to March combined to iron out shortterm fluctuations, industrial output grew by 1.2 percent compared with the preceding three months, the ministry calculated.
Strike ends at Panama Canal expansion project A two-week strike by workers expanding the Panama Canal has ended after they won wage increases, a union leader said Wednesday. The huge project is already a year behind schedule and was halted earlier this year in a dispute over large cost overruns. The agreement to end the stoppage was announced by Saul Mendez, secretary general of the construction workers union Suntracs. The strike was by construction workers throughout Panama. Workers involved in big projects like the canal expansion will get an 11 percent raise this year and further increases over the next three years, Mendez said. The expansion will add a third set of locks to the canal.
Deutsche Telekom profits tripled in Q1 German telecoms giant Deutsche Telekom said yesterday that profits trebled in the first quarter thanks to the sale of a 70-percent stake in its Scout24 online portal. However, underlying profits fell due to heavy investment in the US. Nevertheless, the group said it expected to attain stable profits for the whole year. “At 1.8 billion euros, net profit was more than three times higher in the first three months than in the prioryear period. This is attributable to income from the partial sale of the Scout24 group,” Deutsche Telekom said in a statement. Adjusted for the windfall gains from the divestment, net profit actually fell by 23.5 percent to 587 million euros and underlying or operating profit fell by 3.9 percent to 4.12 billion euros.
May 9, 2014
Indian women show their voting slips as they wait to cast their votes at a polling station during the 8th phase of Parliamentary election at Palampur, Himachal Pradesh, India, 07 May 2014.
Leading reports from Asia’s best business newspapers
TAIPEI TIMES Chinese President Xi Jinping (習近平) yesterday made an indirect response to the concerns voiced by the Sunflower movement protesters against the controversial cross-strait service trade agreement, pledging to learn more about the needs of Taiwanese, particularly those of ordinary Taiwanese. Xi made the remarks at a meeting with People First Party (PFP) Chairman James Soong (宋楚瑜) at the Great Hall of the People in Beijing on Wednesday. Soong began a five-day visit to Beijing on Tuesday, which set up a platform for Xi to address the growing apprehension among Taiwanese of the creeping economic influence of Beijing.
THE ASAHI SHIMBUN Consumer electronics giant Panasonic Corp. is marketing a second generation of its Hospi autonomous drug-delivery robot for hospitals after its first attempt ended in failure. Panasonic introduced the original Hospi model in 2004, but it sold only two units. “We simply failed to grasp the needs of hospitals,” said Yukihiko Kitano, the manager of the Hospi development team at Panasonic Production Engineering Co. The robotic system is designed to carry out routine errands, such as medicine delivery around hospitals, to give nurses and doctors more time to focus on patients. The new Hospi went on sale in October.
THE PHNOM PENH POST Controversial Vietnamese rubber giant Hoang Anh Gia Lai (HAGL) has suspended part of its operations in Ratanakkiri province amid an investigation by the World Bank’s investment arm into claims of land grabbing, a company memorandum reveals. The April 28 announcement states that three projects in Ratanakkiri province – Heng Brother Project, CRD Project and Hoang Anh Oyadav Project – will be suspended from May 1 to November 30. The statement does not cite a cause for the suspension, but notes the decision follows an April 2 meeting with the Compliance Advisor Ombudsman.
BANGKOK POST The charter court ruling which ousted Yingluck Shinawatra as caretaker prime minister may have averted violent confrontations between pro- and anti-government groups, but it has not broken the political deadlock as opponents of the government push forward with other legal challenges. Caretaker Deputy Prime Minister Phongthep Thepkanchana on Wednesday said a meeting of caretaker cabinet ministers not affected by the ruling agreed to appoint caretaker Deputy Prime Minister and Commerce Minister Niwatthamrong Bunsongphaisan as acting caretaker premier, replacing Ms Yingluck.
India’s bourgeois revolution Shashi Tharoor India’s Minister of State for Human Resource Development
EW DELHI – In 2009, when I competed in India’s last parliamentary election, I was something of a rarity. I was not a professional politician. By contrast, all of the other candidates in my constituency – indeed, most of the contenders across the country – had devoted their entire lives to politics, many since their student days. I was not born into a political family; I had no seat or political fiefdom to inherit; and I had entered the race without a political “godfather.” I had not even lived in India for decades, having spent my adult life working abroad for the United Nations. Nonetheless, I managed to wrest a seat from the opposition Communist Party of India, which had won the two previous elections in my constituency, with a substantial margin of 100,000 votes. This victory represented a slight crack in the wellguarded fortress of Indian politics, which had long been reserved for a small and largely hereditary circle. The only exceptions had been movie stars, whose popular appeal was based on fame, not political pedigree. Professionals who had built careers and reputations in other fields simply could not get their foot in the door. But this may finally be changing. In the current general election, there are more non-politician candidacies than in any previous poll. For example, Nandan Nilekani, co-founder of the technology giant Infosys, is running on behalf of the Congress Party in Bangalore, India’s informationtechnology capital, against a five-term incumbent from the Bharatiya Janata Party (BJP). In Mumbai, the newly established Aam Aadmi
(Common Man’s) Party has nominated Meera Sanyal, a former head of the Royal Bank of Scotland’s operations in India. And, in Chennai, the Congress has put forward the electronics engineer S.V. Ramani. This amounts to a fundamental shift from previous generations, when politicians tended to come from either the top or the bottom of Indian society – unless, of course, they were the nationalist leaders who won India’s independence and comprised its original political class (and whose heirs have continued their legacy). They could be maharajahs or zamindars (landlords), with a feudal hold on their districts’ voters and the time and money to devote to politics. They could also be semi-literate members of the underclass, who viewed politics as their only means of advancement and could appeal to others like them. For everyone else, the route to success was to study hard, pass their exams, and build careers based on merit. Such an approach might be understandable in a highly competitive society where the salaried middle class could not take the kind of risks implied by a political career; but it undermined the quality of Indian politics. Indeed, it excluded the educated professionals who tend to be a mainstay of democratic governments elsewhere, bringing middle-class values and convictions to politics. In Europe, for example, middleclass professionals comprise the bulk of the activists, voters, and candidates for political office. In India, by contrast, their counterparts are too busy working to make ends meet to have time for activism. They lack the money found at the top of India’s stratified society,
and they have little access to the votes that lie at the bottom. As a result, middleclass professionals have largely abstained from the political process. That pattern has allowed Indian politics to become increasingly populist, with candidates appealing to the lowest common denominator to win votes. Given this, growing disenchantment with Indian democracy among the middle class is not surprising. Some have even spoken of the “secession of the elites” from Indian politics. That is why the participation of middle-class candidates
In Europe middleclass professionals comprise the bulk of the activists, voters, and candidates for political office. In India, by contrast, their counterparts are too busy working to make ends meet to have time for activism.
in the current election is so significant. If the old pattern is being reversed, the change is almost certainly a result of India’s economic transformation, which has enabled millions of people to join the middle class, bringing with them a new energy and dynamism. Hard-working professionals are no longer willing to sit on the side-lines while the political class makes critical policy decisions. Equally important, India’s educated middle class will, in the nottoo-distant future, become large enough to matter in elections. To be sure, India’s parliament already includes several educated young professionals who previously would not have participated in politics – people with good degrees, a clear vision for the country, international experience, bright ideas, and the capacity to articulate them. But they are all children of politicians. Though the dynastic trend in Indian politics may be bending, it is far from being broken: This year, the BJP has nominated technocrat Jayant Sinha for the seat being vacated by his father, former Finance Minister Yashwant Sinha. And yet, despite their hereditary advantage, this new generation of educated, articulate, and forwardthinking politicians is raising the standard of Indian politics – a shift that the growing involvement of well-educated professionals will advance further. If the current trend continues, India’s middleclass voters will have more representatives with whom they can identify, rather than having to pay allegiance to politicians for whom they constantly need to make excuses. That will be Indian democracy’s salvation. The Project Syndicate 2014
May 9, 2014
Closing Call for bids for wireless broadband work
Angola: Chinese PM on two-day official visit
Macau government says it will put out to public tender this year a contract to build a new wireless broadband system in Macau. It says the deadline for bidders to submit the necessary documents is June 11. The government hopes the new wireless broadband system will mean better and wider wireless broadband coverage.
China’s prime minister, Li Keqiang, started a two-day official visit to Angola yesterday, part of an African tour that also includes Ethiopia, Nigeria and Kenya. The visit’s programme has not been disclosed, but Beijing said that it would not be just about business. The two countries established a strategic partnership in 2010 of “oil for money”, where the Chinese credit lines correspond to Angola’s oil exports.
Genting's Resorts World in Singapore
Genting plans to revitalise Las Vegas Nevada officials consider gambling operator suitable to open a US$4 billion casino resort and increase presence in the US market
he Nevada Gaming Control Board (NGCB) considers the Genting group ‘suitable’ to build a new mega-resort in Las Vegas in order to boost tourism in the former world’s gambling capital with an investment set to top US$4 billion dollars. Gambling Compliance reported yesterday that NGCB voted unanimously for a preliminary finding of suitability of the Malaysian gaming operator to spend between 3 to US$4 billion dollars to build a multifaceted Chinese themed entertainment resort.
The Nevada Board described Genting as ‘a good company’ with member Terry Johnson stating that “it’s an enormous project and has enormous potential for this state, and it could mark a revitalization of sorts for that end of Las Vegas Boulevard and the Las Vegas community”.
US$500 million tax revenues According to Gambling Compliance, the resort will offer 3,500 slot machines and table games situated
around an open area for shows, 3,000 hotel rooms, 22 luxury villas for guests, retail shops and 30 restaurants and bars. Construction is set to start later this year with the first phase expected to be completed within two and a half to five years. The resort will feature a 674 foot high tower with an LED ball on which images, including guest postings on Instagram, Facebook and other social media, will be projected. The top of the tower will have a casino and observation deck. This phase will create 8,500 jobs and
generate from 150 to US$500 million dollars in tax revenues for Nevada’s government.
New visitation The second and third phases of the resort will add three non-Genting hotel towers, movie theatres, bowling alleys, a water park and a 50,000 square foot, 54 foot high aquarium, Gambling Compliance wrote. Genting’s chairman and major shareholder, Kok Thay Lim, said that the new resort will create ‘new visitation’ to Las Vegas without
Adelson ready to spend to Portugal: Central Bank fight internet gambling in U.S. profit slides 43.7pct
heldon Adelson, the billionaire founder of Las Vegas Sands Corp., is willing to spend “whatever it takes” to ban online gambling in the U.S., saying it will take advantage of vulnerable players. In a Bloomberg Television interview, he said neither the industry nor government would be able to adequately police betting on the Internet. “It exploits too many people that can’t afford it, that shouldn’t be doing it,” Adelson said. “My father went to the horse races in the daytime, the dog races in the night time. Why should poor people who cannot afford to lose that kind of money be tempted with that kind of activity?” Adelson, ranked the world’s 11th richest person by the Bloomberg Billionaires Index, said his casinos would be unaffected by online gambling in the U.S. Las Vegas Sands gets 85 percent of its revenue from Macau and Singapore, and caters to wealthy gamblers, according to Adelson, whose net worth totals about US$36.7 billion. Bloomberg
cannibalising the other casinos in the gambling city. NGCB board member Shawn Reid said that Nevada needed the new casino-resort with Johnson mentioning several regulatory violations by the Genting Resorts World Sentosa, the group’s resort in Singapore. Three individuals were criminally prosecuted. One employee was fined S$100,000 and the other two S$10,000 each. Genting Sentosa terminated the contract of one employee and halved the pay of the other two employees because of their criminal offences.
Portuguese President’s itinerary revealed
he Bank of Portugal will be chipping in with €202 million to the state coffers courtesy of its 2013 dividends but that is down 43.7 percent from 2012 due to a slump in profits, according to the 2013 Management Report. Correspondingly, year-on-year profits at the bank regulatory entity fell from €449 million in 2012 to €253 million last year. In terms of the dividend to the state, this has slumped from €359 million to the aforementioned €202 million in 2013 with the state thus seeing a €157 million fall in its taking. The aforementioned report attributes this fall to the “reduction in the interest rate margin and the results attained in financial operations, the rise in non-accounted for losses from financial operations and the decrease in the net results of the shared monetary income.” Nevertheless, the items contributing to this drop in results were at least partially offset by the “reduction in the strengthening of provisions for general risks.” Lusa
he President of Portugal will arrive in Macau on 17th May, on which day he will meet the Chief Executive of Macau, Chui Sai On, in Government Headquarters. Following the meeting, the CE will host a dinner at MGM to honour the visiting Portuguese head of state. On the second day, Aníbal Cavaco Silva will meet the President of BNU, Pedro Cardoso, in the Mandarin Oriental Hotel. Following this, the leader will visit Luis Vaz de Camões Garden, the Ruins of St. Paul and the Portuguese School of Macau. The President will lunch at the Military Club, where he will witness the signing of a protocol between the Portuguese-Chinese Chamber of Commerce and Industry and The Macao Chamber of Commerce. In the afternoon, President Silva will visit the University of Macau, Macao Polytechnic Institute, Macau Institute for Culture and the Portuguese Consulate.