Anselmo L S Teng: Establishing a platform for financial cooperation and
promotion of economic and commercial interaction
Speech by Mr Anselmo L S Teng, Chairman of the Monetary Authority of Macao, at the
Conference of Central Banks and Regulatory Authorities of Portuguese Speaking Territories,
Macao, 6 April 2009.
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Dear Delegates, Distinguished Guests, Ladies and Gentlemen,
Good Morning!
Allow me to propose a vote of thanks, on behalf of the Board of Director of the Monetary
Authority of Macao (AMCM), to our counterparts who attend this conference today. At the
same time, I would like to extend our warm welcome to all distinguished guests, friends of
the financial industry. I would also express my gratitude to the Commercial Attachés of our
country's embassies in Lusophone countries.
In the wake of the New Year, the financial tsunami which erupted in September last year still
lingered in the international financial markets. Intermittently, worrisome news gave rise to
uneasiness and undermined confidence. The government and market participants of markets
where the financial crisis erupted endeavoured to carry out measures to salvage and impart
confidence. However, this financial impact, which devastated the globe, has already inflicted
deep and extensive negative damages to the financial system. It has brought great and long
term negative effect to the overall economy.
As financial regulators, we realize that the eruption of financial tsunami has posed a few
soul-searching issues. However, in the face of an issue of such generality, it may not be the
most effective and correct solution if we rely on one's own adjustment and conclusion. We
believe that if we want to adopt effective measures with a view to stabilizing the financial
system and rebuilding confidence of consumers, we need to seek international participation
and cooperation, including enhancing communication and cooperation between financial
regulators.
Promoting international financial regulatory cooperation mechanism is pivotal when the world
economy is at its development stage. And it will become a measure which carries special
connotation when there is fluctuation and mutation in the world financial system. We in fact
have one common objective; protecting the lawful rights of consumers, maintaining the
stability and security of financial system, facilitating orderly development of the overall
economy. When the operation of the market calls for appropriate fine tuning, when its
business requires more effective supervision, when its structure requires reasonable
consolidation, it will be the responsibility of the regulators to implement appropriate policies
and measures which will be commensurate with the expectation of the community.
On 25 September 2006, an "Economic and Trade Cooperation Plan" was passed in a
ministerial level meeting of the Economic and Commercial Cooperation Forum of China and
Portuguese Speaking Countries held in Macao. The delegates were ministers responsible for
economic and commercial affairs of 7 Portuguese speaking countries and China.
The ministers reviewed the development since the inception of the Forum. They actively
appraised the economic and commercial results achieved under the framework of the action
plan. At the same time new economic and commercial activities beneficial to implementation
of new development within the realm of cooperation were incorporated in the newly
formulated action plan. The delegates agreed to promote the endeavour of financial
institutions of the member states with a view to locating source of fund for items of common
interest within the framework. The feasibility of establishing a financial cooperation
mechanism under the Forum was mulled.
Financial cooperation and economic and commercial communication between China and
Portuguese speaking countries has a long cordial relationship, which is of much importance
in the co-coordinated development. Based on existing foundation, we can expect a
sustainable relationship in cooperation. At this particular juncture, when global economy is
sinking into recession or stagnation, the impetus to jump start economy appears the more
precious. China and Brazil are renowned to be members of the BRIC. They have delegates
present in this conference. Together with representatives of other Portuguese speaking
countries which have tremendous economic development potential, the delegates will
exchange candid dialogues with a view to enhancing financial cooperation to promote
economic and commercial flow. We believe, we can reinforce our cooperation through all
these beneficial and constructive communications.
Taking into account its constraint of natural resources and its geographical location, the
MSAR has been assiduously developing tertiary industry, particularly tourism and services
industry. Simultaneously, the Government has put forward a policy measure to build up
Macao to become a regional service platform, which includes the function of service platform
for economic and commercial cooperation between China and Portuguese speaking
countries. In fulfilling its duties, AMCM proactively encourages the financial sector to explore
the market, make acquaintance with counterparts, seek commercial opportunity and strive to
score a reasonable return on capital. Therefore it has organized many times representatives
of the financial sector for overseas visits, which cover markets with development potential.
The visits have enabled the delegates to understand the development of financial markets
overseas, befriend with merchants and counterparts, establish cordial linkage. I think many
delegates here have had the experience of receiving your Macao counterparts. I am sure
such mutual visits and communications have forged a long lasting memory in our minds.
Thanks to the candid introduction by various central banks and regulatory authorities, the
auspices of the diplomats of our country and the active participation of representatives of our
financial institutions, the overseas visits organized by AMCM have achieved the desired
results. The visits have brought recognition of the fine results of our financial sector and laid
a solid foundation for exploring overseas markets, business liaison and cooperation. From
the regulator's point of view, the visits have enhanced the effectiveness and quality of
supervision, strengthened mutual working relationship via the signing of memoranda of
understanding with regulatory authorities of Portuguese speaking countries. In a way, these
visits have facilitated the internationalization of the financial supervision of the MSAR.
I take this opportunity to introduce to you ladies and gentlemen how AMCM encourages the
local financial sector to strengthen their overseas networking. I hope you can share my view
in this respect. A regulator should be true to its job by assiduously fulfilling its supervisory
duties. At the same time, it should think beyond this by considering the needs and position of
market operators. More importantly, when the market is battered or disturbed by unstable
factors, the regulator should exert more efforts to safeguard market stability and lawful rights
of consumers, manage and dispel the adverse effects by identifying and eliminating the
source of the problem in a timely manner, support the restructuring of a healthy market
environment. To put it in a nutshell, a regulator should fine tune its policy and maintain order
in the market in a positive and active manner to ensure the normal operation of the market
and systemic security.
In view of above, AMCM has been adopting a proactive manner in response to China's
proposal in the Forum's ministerial meeting to establish a mechanism for closer financial
cooperation, which will no doubt realize the objective of improving the standard of living of
people in the areas involved through more aggressive economic and commercial activities.
The objectives raised by the Forum carry special meaning, they are viable and feasible. As
pointed out by Mr. Francis Tam, Secretary for Economy and Finance, the economic and
commercial cooperation between China and Lusophone countries is complementary and
necessary. Enhanced cooperation will be of mutual benefit through maximization of utility in
deploying resources, which will increase productivity and is conducive to raising quality of life
of people in the area involved.
As a matter of fact, the headquarters of Portuguese capital banks operating in the MSAR
have long connections with Portuguese speaking countries. They have been utilizing such
historical and social connections to build up business network in these developing countries.
They arrange financing facilities for local governments and enterprises of all sizes in addition
to syndicated loan arrangements. As a result, they are already quite versatile in this respect.
On the other hand, a Chinese capital bank operating in Macao has in the past years been
actively exploring financial business in certain Portuguese speaking countries in Africa and
has been quite successful in building up concrete business cooperation through local
Portuguese counterparts. Although these are all at rudimentary stage, it carries very
important connotation. We should be more affirmative in this respect and hope that more
local financial institutions will follow suit. Greater achievements are contemplated.
The financial institutions operating in the MSAR should make use of such an opportunity to
extend business network to these Portuguese speaking countries in an orderly manner.
Simultaneously, market participants should adopt a modern business mentality and take
positive action to understand and get familiar with the markets of Portuguese speaking
countries. We are glad to see more different forms of cooperation, such as establishing
exchange of market information with the local financial institutions operating in the private
sector of Portuguese speaking countries, or organizing more syndicated financing facilities,
or even forming a partnership via crossholding of equity. Starting from cooperation between
governments, we can extend practical cooperation to privately run financial institutions which
will no doubt create a locomotive effect in establishing a holistic and multi-level cooperation
network.
Today, we are facing the threat of economic recession arising from systemic risks in certain
credit markets. One thing for sure, countries involved in the process of globalization must
have felt the pinch. However, we should never put the blame on economic globalization,
which lies in the course of history and is an issue which carries positive connotation.
Therefore, strengthening regional cooperation via different methodologies, enhancing
crossborder cooperation, reinforcing cooperation between countries which use the same language
are conducive to the facilitation of economic globalization. As long as we endeavour, we can
achieve, via a synchronized cooperation mechanism, the most efficient allocation of resource
so that the target of improving the living standard of the general public can be realized.
Coming back to the main theme of this conference, our target is to promote financial,
economic and commercial interaction through the establishment of a platform for financial
services. It goes without saying that the financial sector will much benefit in taking part in this
function. The ultimate goal however is to improve the well being of the general public through
economic and commercial interaction. In my visits to many Portuguese speaking countries, I
have had the chance to converse with officials of their regulatory authorities. Some
Lusophone countries in Africa have experienced unstable political scenarios for quite some
time. They are however endowed with the essential factors for development. The domestic
officials are eager to improve the well being of their people. The responsible persons of the
financial regulatory authorities are especially displaying such fervour. They realize their
burdens and missions. I have been highly impressed by their ardent attitude in learning from
the experience of other organizations.
In the new millennium, all nations have been making use of the relatively stable political
environment to formulate economic development policies. The end results may be different
due to their indigenous conditions. However, we have witnessed that many people have
been lifted from the abyss of poverty, while some have become quite well off. In the process,
the financial industry has been wholeheartedly providing support and deployment to nurture
stable economic development. The objective of improving economic situation is to satisfy the
demand of the general public. Financial development serves the economy, while economic
development satisfies the demand of the general public. The establishment of a platform for
the financial development contemplated by the MSAR Government is meant to jump start the
local economy, promote appropriate industrial diversification to ensure sustainable
development of the economy. Through the structuring of a financial services platform,
economy and trade can progress steadily which will create a stable, secure and healthy
market economy. Our delegates come from public and financial sectors of Portuguese
speaking countries in 4 continents. We may not share the same background historically and
socially, but we share the same language system and we adopt similar legal system. We can
share our experience in the course of our different developments. We communicate, attempt
to converge our views but retain our inclusiveness with a view to realizing closer cooperation.
Our conference today denotes that we basically share the idea of a common topic, around
which we positively and proactively offer our opinions and proposals. We have taken a major
step forward by offering a candid attitude to promote and realize a common objective.
Before I conclude, please allow me again to propose a vote of thanks to guests and
delegates who have come a long way from home to attend this conference hosted by AMCM.
Simultaneously, I would like to express our warmest gratitude to the delegates for their
candid and frank opinions. On the other hand, there may be deficiencies in organizing this
event due to various constraints. In this respect, your opinions and tolerance are most
appreciated. I would like to take this opportunity to wish you good health and a pleasant stay
in Macao. More importantly, I hope Macao will impart to you a fine and long lasting memory.
Thank you!