After World War II Stanley Ho was 24 years old, newly rich, and quick to jump on new business opportunities in Hong Kong and Macau.
Within weeks of the Japanese surrender, Ho was back in Hong Kong making strategic investments. He had connections in Macau, thanks to his business holdings and his marriage to Clementina Leitão, of the prominent Portuguese Leitão family. (Clementina’s father was a wealthy businessman; her grandfather was a lawyer and Macau’s only notary public for a time). At the end of a previous case, Stanley Ho’s Lucrative War, we covered how quickly Ho bought a boat in Hong Kong after the Japanese occupation ended in 1945, starting one of the first post-war ferry services between the two colonies. The opportunity must’ve been obvious: there were plenty of Macau-Hong Kong ferry services before the war; there would be plenty of demand for cross-colony transport after the war. Ho had the money to buy boats, at a time when many others were decimated, so why not him? He was in the business of ferrying visitors from Hong Kong to Macau till the end of his life.
The Playing Field
Ho continued to be on good terms with Pedro Lobo, as a result of helping the tycoon with the Macao Cooperative Company between the years of 1941 to 1945. After the war, Lobo remained the top tycoon in Macau. He was of mestizo Portuguese-descent, with Malay, Chinese, Dutch and Portuguese ancestors; this had long put him on good standing with the Portuguese colonials. Before the war, Lobo’s wealth came from operating the colonial Portuguese government’s opium farm — a monopoly. After the war, Lobo’s wealth came from control of Macau’s gold trade — given his dual government and commercial roles, Lobo collected taxes on gold for the government and then took a larger mandatory cut for his cartel (again: another monopoly). The cartel included a small group of businessmen from the two colonies: Ho Sin Hang, Cheng Yu Tung, YC Liang, Lobo himself, and the most prominent Chinese businessman of Macau at the time, Ho Yin (no relation to Stanley Ho).
Ho Yin and Lobo were long-time business associates. In 1945, at the end of the war, Lobo was 53 years old and Ho Yin was 38. They were much older than Stanley Ho’s 24, and probably saw him as an up-and-comer. This fact is notable because Ho was friendly with Lobo but did not share the same special relationship with Ho Yin, who would become Macau’s most important businessman after Lobo’s death. About which, more in a bit.
Founder of the People’s Republic of China Mao Zedong (left) with Ho Yin (right). (Source).
In the years immediately after World War II, the gold trade was probably the most important — and certainly the most lucrative — monopoly in Macau. The second most lucrative monopoly was gambling, which for most of its history made up the majority of the colony’s tax revenue. But in the years 1944 through to 1971, gold was more important to Macau than gambling, and many tycoons — Ho Yin and Lobo included, built their business empires off the back of the gold trade.
The reason for this was pure chance. Portugal had been neutral for much of World War II, which meant that it was not a signatory for the 1944 Bretton Woods Agreement, which fixed exchange rates and restricted world trade in gold. Amongst other things, Bretton Woods banned imports of gold for individual use and stipulated that a troy ounce of gold would always cost US$35 (US$623.81 in 2024 dollars). This was great for Macau: it was a colony of Portugal, Portugal was not a signatory, and as a result Macau became the global hub for gold smuggling nearly overnight. Lobo and his cartel would purchase gold from Russia and Mexico legally, at cheap prices (these were, like Portugal, non-signatories to Bretton Woods) and then sell the gold on the open market at US$35, pocketing the massive profits.
Stanley Ho was almost certainly aware of this trade, but he was not involved with it for as long as it was run by Lobo, his mentor. Years later, when Lobo died in 1965, Ho attempted to get the Portuguese colonial government to grant him the gold monopoly; he offered them a larger cut. But Ho Yin had grown in importance by then. The man was not only the most powerful businessman in Macau, but also a critically important go-between for the Portuguese colonials with the communist government in China. The colonials rebuffed Stanley Ho and stuck with the older tycoon. Naturally, some members of the cartel threatened Ho.
What this meant was that, from the years of 1945 through to the 1960s, Stanley Ho was locked out of the easiest, most lucrative business in Macau. In the early years after World War II, he continued with his ‘trading’ businesses. Joe Studwell recounts some of these activities in Asian Godfathers:
The great thing about the war, from a business perspective, was that it never really ended. There was a chaotic, corrupt period of allied military administration following the official close of the Pacific war and then, in 1950, the Korean conflict started. In 1951 the United Nations imposed a trade embargo on China, which was allied with North Korea, creating a vast smuggling industry centred on both Macau and Hong Kong. Stanley Ho carried on his smuggling operations, shipping corrugated iron, rubber tyres and, he says, vast quantities of Vaseline into China. His future partner in the Macau gaming monopoly, Henry Fok, became a sanctions-buster on a far greater scale, shipping huge quantities of petroleum products and pharmaceuticals and – though he always denied it – some weapons as well. A Time magazine investigation in August 1951 found ‘freighters on the Pearl [river] last week were laden with steel rails, zinc plate, asphalt, Indone ...
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