The diversification theme pops up frequently in debates about the Macau economy. For a long time, people have been pondering on how to ‘build’ a more resilient economy, less dependent on the gambling sector’s health.
In the frontline, in almost every (if not all) declarations and policy statements, there were always two sectors: the conference and exhibition sector, usually identified by the MICE acronym, and the traditional Chinese medicine (TCM) sector.
The first has been mostly a disappointment. First, it still lacks a clear approach that considers the developments in that activity in the neighbouring region and, second, needs to set a path more independent of the gambling and gambling-related tourism activities.
Such momentum is nevertheless missing even with substantial support from the government. The sector is still a minor player in the overall economy.
The development of the second, TCM, has lived under some ambiguity. Indeed, it is an activity that, for once, has no relationship with gambling. However, it has never been clear who were the relevant players from Macau with the knowledge, skills, and resources to develop the area.
Economic specializations do not fall from the sky and seldom work by decree. Further, the effort is focused across the border, raising questions about how it will benefit the Macau economy and its population.
The most visible part of that effort was the investment in a TCM park in Hengqin, financed and managed by a company – Macau Investment and Development, SA. It was created in 2011 with public capital to develop joint projects with Guangdong.
The affair has always been less than straightforward or transparent, leading to doubts when not express concerns about the appropriate use of public money, if not the wisdom of the project or approach.
The Commission of Audit (CA) recently published a report on the subject. It does not dispel concerns; it adds to them. Without discussing the details here, it is fair to say that the CA is less than thrilled with the management and results.
Moreover, we find out the company now has no less than 21 subsidiaries, turning it into a ‘public conglomerate’ involved in external businesses – which essentially appear to have developed beyond any real administrative or public scrutiny.
Further, no public record can be found of its activity and accounting reports. When there is so much talk of public money scrutiny and transparency, this can hardly be fitting.