The local government has announced that it will set up a so-called “guidance fund” aiming to draw investments from high-quality enterprises to Macau’s emerging industries, as part of the government’s ongoing campaign to appropriately diversify the city’s economy.
Announcing details of the fund on Friday, the government said that it was planning to allocate 11 billion patacas from the returns that it has earned from investing its financial reserves over the years, adding that the government expects the size of the fund to amount to 20 billion patacas after including the first tranche of private capital. The government said that it was aiming to complete the setting-up of the guidance fund within this year.
The government also said that while it will play a leading role in guiding private sector’s investments to be made in Macau’s emerging industries, it is aiming for the guidance fund’s operation to be mainly driven by market forces.
The government announced the guidance fund during a press conference at the Macau Science Centre (MSC) in Nape on Friday.
During Friday’s press conference, Secretary for Economy and Finance Anton Tai Kin Ip underlined the local government’s commitment to aligning with the nation’s 15th Five-Year Plan, accelerating the development of high-tech industries in Macau, and fostering new quality productive forces, with the aim of creating a new engine to drive the city’s appropriate economic diversification, building an innovation-orientated industrial system, and accelerating the pace of the city’s transformation and upgrading.
Tai said that in compliance with the local government’s plan to establish a government industrial fund and a government guidance fund, his office, in close coordination with the Macau Monetary Authority (AMCM), the Economic and Technological Development Bureau (DSEDT), and the Commerce and Investment Promotion Institute (IPIM), set up a preparatory working group on the matter.
After assessing Macau’s current economic situation and the conclusions of a feasibility report prepared by a team of experts hired by the government, Tai said, the working group has now drawn up a plan for the government’s guidance fund.
Govt’s leading role, market operation
Tai said that the guidance fund aims, through the government’s financial participation, to channel different types of private capital towards investments made in Macau’s key emerging industries and future industries, thereby achieving the government’s policy objectives of enhancing the leveraging effect, pooling market capital, cultivating technological innovation enterprises, and optimising the city’s industrial structure.
These policy objectives, Tai said, aim to solidly advance Macau’s appropriate economic diversification and its industrial upgrading, support the transformation of technological achievements and their industrialisation, create more quality jobs for local residents, and promote the diversification of employment opportunities in the city.
Tai said that the government will play a leading role in guiding the fund, but with its operation to be mainly driven by market forces, while clearly defining the key industries and their development directions. With the establishment of mechanisms and rules for the selection of qualified fund managers, Tai said, the fund will create favourable conditions for promoting the strong participation of the market, fully leveraging the professionalism, flexibility, and high efficiency of market operation.
‘Patient capital’
Tai also pointed out that the nation, over recent years, has been advocating the use of “patient capital”, a synonym for long-term capital, as an instrument for sustained support for the development of key industries. Tai underlined that the operation of the guidance fund to be set up by the local government will also stick to the principle of patient capital, without prioritising short-term financial returns as its main objective, and instead favouring a long-term and systematic strategy to vigorously promote the development and upgrading of key industries.
According to DeepSeek, patient capital is a long-term investment approach that prioritises sustainable growth and significant future impact over immediate, short-term financial gains. It involves providing funding with the expectation of returns over an extended period, allowing investments in areas like infrastructure or pioneering technologies to mature and deliver substantial long-term economic or social benefits.
Moreover, Tai said, the guidance fund will also be an important tool for deepening the Macau-Hengqin integrated development and the coordinated development of the Guangdong-Hong Kong-Macao Greater Bay Area (GBA). Tai said that the guidance fund will help attract quality enterprises, highly qualified scientific researchers, and highly qualified professionals in the financial sector to Macau, Hengqin, and the GBA.
Tai said that the local government is planning to allocate 11 billion patacas to the guidance fund from the returns that it has earned from investing its financial reserves over the years. Together with the first tranche of private capital, Tai said, the government expects the size of the fund to amount finally to 20 billion patacas.
Tai underlined that the guidance fund aims to encourage, pool, and guide the mobilisation of private capital, attracting quality enterprises and qualified fund managers to participate in investments in the key industries guided by the government.
Fund’s governance system
Also addressing Friday’s press conference, Tam Chi Neng, an advisor to Tai’s office, said that the operation of the guidance fund will comprise three layers. The first layer is the guidance fund per se, while the second layer refers to a fund under the guidance fund to be primarily tasked with supporting the transformation of technological achievements. The third layer refers to the establishment of different ad-hoc funds aiming to specifically support different emerging industries.
Tam said that the guidance fund’s operation will be overseen by the chief executive, while the government will set up a public enterprise tasked with the fund’s day-to-day operation and management.
Tam said that the public enterprise will select and hire qualified fund managers from the market to be tasked with managing the fund in the second layer. The fund managers will also be tasked with attracting additional private capital to the guidance fund.
In addition, Tam said, the government will also set up a consultative committee tasked with providing opinions for the guidance fund’s policy directions, strategic planning, and other important matters.
The consultative committee, Tam said, will consist of government officials, professionals, academics, and other individuals from the respective fields.
Tam said that the government is aiming to complete the setting-up of the guidance fund within this year, adding that the upcoming tasks will include the setting-up of the public enterprise and drawing up an administrative regulation governing the fund’s operation.
Secretary for Economy and Finance Anton Tai Kin Ip (up) and Tam Chi Neng, an advisor to Tai’s office, address Friday’s press conference at the Macau Science Centre. – Photos: Tai’s office
