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China's Xi to unveil plans to make Macau a financial hub, says report
CHINESE President Xi Jinping plans to announce policies aimed at diversifying Macau's economy beyond gaming, Reuters reported, in a nod of support as unrest continues to trouble neighbouring Hong Kong. The policies include establishing a yuan-denominated stock exchange, accelerating a yuan settlement centre which is currently being developed and allocating land for Macau, Reuters said, citing unidentified government officials and company executives. The measures were intended to mark the 20th anniversary of the former Portuguese colony's return to Chinese rule, an event that will bring Mr Xi to Macau, the report said.
The bourse would focus on bond trading first to encourage local and mainland companies to issue debt in the city, Reuters said. The exchange would also focus on startups and target companies from Portuguese-speaking countries to avoid direct competition with Hong Kong or Shenzhen, it reported, citing six Macau executives and Chinese officials.
Mr Xi will also announce Macau's decision to join the Beijing-based Asian Infrastructure Investment Bank. Future priorities will include tourism and finance, and for Macau to be used as a venue to host international meetings like Singapore, an official told Reuters.
Casino stocks jumped to session highs after the report, reversing declines seen in recent weeks following soft November gaming results. Wynn Macau Ltd led with a 4.7 per cent gain on Thursday in Hong Kong. Other stocks in the sector rose at least 2.5 per cent. The Hong Kong and Macau Affairs Office in Beijing didn't immediately respond to a faxed request for comment on Thursday. Macau's Office of the Chief Executive also didn't respond to an e-mail seeking comment.
The plans may have been in the works for a while. The Securities Times reported in October that a proposal for a securities exchange in Macau was submitted to the Chinese central government. The authorities were researching how to fit Macau's advantages into Mr Xi's broader Greater Bay Area plan to knit the region together more tightly, the Security Times said at the time.
The blueprint for China's long-awaited plan to create a high-tech megalopolis on its southern coastline rivalling California's Silicon Valley was unveiled in February. Proposals include setting up a futures exchange in Guangzhou with carbon emissions as the first product and setting up a securities market in Macau using yuan settlement.
Macau is looking to diversify its economy as growth in China slows and the high-rollers who helped make the city the world's largest gaming hub look elsewhere. Local casinos are poised for the first decline in annual gaming revenue since 2016, when Mr Xi's anti-corrupting campaign battered revenues.
The move comes as pro-democracy protests continue to hurt the economy of Macau's fellow former colony of Hong Kong, which is among the world's leading financial centres. While the policies weren't intended for Macau to replace Hong Kong, China wants a contingency plan if the situation in Hong Kong worsens, Reuters said, citing people familiar with the discussions. BLOOMBERG