Inside Asian Gaming

November 2014 inside asian gaming 27 By necessity, the top posts at Macau’s SWF would initially go to foreign talent, but there’d be a clear mandate that it recruit and cultivate the best and brightest aspiring fund managers from within the city—talent that might be lost otherwise to investment banks overseas. Many fledgling Singapore financiers have passed up on jobs with the likes of Goldman Sachs and Merrill Lynch to work for GIC, opting for the diversity and the challenge and the opportunity to serve one’s country. After all, while many employees are enamored of big-name employers, some canny ones understand the value of being part of a small outfit. As touched upon in this issue’s cover story, smaller companies are often able to make quick, decisive moves to capitalize on opportunities. And such environments breed innovation. In September, GIC sent shivers through smaller financial firms by announcing it was taking the unusual step of investing directly in unlisted firms—essentially subsuming a function previously only performed by private equity. Macau’s leaders and citizens have repeatedly been told from on high to diversify the economy, but haven’t been given any clear direction on how to do that. So, the choice is either do nothing, or try experimenting, possibly breaking with convention. A Macau SWF would support further development of the local financial sector, which has been itching to grow in line with the economy. Critical mass, that old chestnut, will draw more financial talent to the city, and though Macau could never hope to compete with the might of neighboring Hong Kong’s financial sector, there’s certainly room to offer more wealth management services to people in Macau. It would be a boon to Macau’s diversification if there were some venture capitalists among the professionals drawn to the city by the newfound critical mass of its financial sector. Macau suffers a dearth of professional business incubators to mentor promising startups and help guide their ideas from concept stage to final product. Indeed, if Macau’s SWF were intent on being maverick and exploring all possibilities, it could even choose to dabble at the venture capital stage on a handful of worthy concepts proposed by budding local entrepreneurs. In Hong Kong, leading corporations offer hotly contested scholarships to exceptional students headed for top universities worldwide, with the stipulation that they return after graduating and work for the company—receiving an attractive salary—for a set period. Generally, the returning students end up working for the companies long beyond the agreed period, and sometimes for life. Macau’s SWF could offer a similar scheme, sending gifted students to Harvard or Oxford who on their return would be fresh with enthusiasm and ideas to come up with revolutionary approaches to managing Macau’s wealth and driving the city’s much-needed diversification. THE END of DRUDGERY The world’s top six countries by GDP per capita have relatively small populations. Norway, with 5 million, is by far the largest. Qatar comes next with 1.8 million, though only 278,000 of those are classified as citizens, with a further 1.5 million foreign workers, largely hailing from the Indian subcontinent and the Philippines, brought in to do the grunt work. Macau, with 607,500 is not far off Luxembourg’s 543,202. And the populations of Monaco and Liechtenstein don’t EVOLVING MACAU Macau suffers a dearth of professional business incubators to mentor promising startups and help guide their ideas from concept stage to final product. Indeed, if a Macau sovereign wealth fund were intent on being maverick and exploring all possibilities, it could even choose to dabble at the venture capital stage on a handful of worthy concepts proposed by budding local entrepreneurs. even break the 40,000 mark (though 48,000 workers commute daily to Monaco from France and Italy). It’s no surprise that places endowed with precious resources— whether rich energy deposits or lucrative gaming licenses—achieve higher GDP per capita when the takings are divided among smaller populations. But you need workers to exploit those resources. Qatar’s solution was to bring in migrant workers from poor countries willing to do the hard work for low wages. In Macau, there’s no messy oil to be extracted or dangerous manufacturing to be done. When it comes to a front-of-house role in a casino, dealing cards is pretty much the main drudge work available. But, perversely, the knee-jerk political impulse to protect Macau citizens led to dealer jobs becoming the sole preserve of locals, and