Sunday, November 27, 2016

The Spies of Macau



Instituto Salesiano, Macau, site of a Chinese Communist clandestine radio station during World War II

Long before Macau was “The Vegas of Asia,” it was a Portuguese-administered porto de abrigo, or haven, for political activists.   Secret societies dedicated to overthrowing the Manchu (Qing) Dynasty were based there in the 1870s.  The father of modern China, Sun Yat-sen, resided in the enclave at different times in the 1890s, and founded the Tongmenghui (Liga Unida, or Unity League) in Macau in 1905.[1]

With the collapse of China’s last dynasty in 1911 and the Bolshevik victory in Russia in 1918, Macau became an increasingly attractive haven for another activity—espionage. The Portuguese rounded up Chinese Communist cells in 1927 and 1929 and in the 1930s.  While Ho Chi Minh briefly lived in Macau, the Indochinese Communist Party held its first congress in the Hotel Cantão (Canton Hotel) from 27 to 31 March 1935.  In 1937 a Russian NKVD “illegal” agent posing as a Frenchman was discovered operating a restaurant.[2]   These are just the publicly known cases.

As they prepared to invade China, the Japanese made investments in Macau, posting intelligence officers under commercial cover.[3]  When Tokyo’s forces swept across the mainland and reached south China in mid-1938, Macau had become “a center for Japanese espionage and in turn one for Chinese counter-espionage” according a Portuguese report, which urged neutrality to preserve Lisbon’s control.[4]  Japanese soldiers patronized Macau hotels, restaurants and gambling houses without paying, the Japanese Kempeitai (secret police), maintained a strong presence, and their forces controlled movement in and out.  However, Japan mostly respected Macau’s neutrality:  the British consulate stayed in place, the Portuguese administration remained intact, and Macau absorbed hundreds of thousands of refugees.[5]

Though the environment remained hostile to the Chinese Communists, their urban agents and rural guerillas found opportunities to expand operations.  Pan Hannian, who ran all communist espionage operations in Japanese-occupied China, directed Dr. Ke Lin, a veteran secret agent,[6] to move from Hong Kong to Macau in 1935 and establish a medical clinic.  The mission: befriend and recruit General Ye Ting to the communist cause.  Ke was successful, and continued clandestine operations in Macau for 16 years.  Most important for the long term, Ke cultivated and recruited Macau business figures such as Ho Yin and Ma Man-kei to assist the cause.

Chinese Communist East River Column guerillas began operating in the region when the Japanese army arrived in 1938, and maintained three clandestine radio stations: in the Hong Kong New Territories, on Landau Island, and in downtown Macau.  The Macau station operated without interruption from the Salesian School (Escola Salesiana—today’s Instituto Salesiano), on Rua Central (Central Street).  The Japanese tried but failed to locate the Macau station, which stayed on the air, undetected, until the end of the war.[7]

With Japan’s surrender in August 1945, the Chinese Nationalists surrounded Macau, as had the Japanese before them, and placed operatives among “class associations” of herbalists, barbers, hotel employees, and in factories.[8]  In the midst of regular Nationalist bombings and shootings against communists in Macau, Ho Yin appealed to the Portuguese for protection.   Lisbon’s representatives tolerated secret operations of both the Nationalists and Communists as long as they did not disturb public order.

The Nam Kwong Company, founded in August 1949, became Beijing’s unofficial office in Macau through 1987—when Xinhua, the New China News Agency, assumed that role as it had in Hong Kong.[9]  Ho Yin and Ma Man-kei founded educational and business associations to counter the continuing strong presence of the exiled Nationalist Chinese.  Ho Yin became the chief intermediary between Beijing and Macau’s Portuguese administration, and ran some of Macau’s lucrative gold smuggling operations—enriching himself and bringing $27 million a month into China after the People’s Republic was declared in 1949.[10]  Portuguese officials, under increasing pressure from both sides, largely turned a blind eye to these re-exports, which during the Korean War also included petroleum, tires, and medicines destined for the Chinese People’s Volunteers in Korea. 

The balance of power in Macau dramatically shifted in 1966.  A string of Nationalist Chinese bombings and assassination attempts occurred that year, including an American-made grenade thrown at a car carrying Ho Yin on 8 May.[11]  With the advent of the Cultural Revolution that month, Beijing’s agents in Macau prepared to move.  Portuguese mishandling of an unlicensed communist school on Taipa triggered massive demonstrations beginning 3 December, which became known as the “12-3 (Um dois três) Incident.”  Portuguese authorities were forced to close or expel the Taiwan’s overt and clandestine organizations.[12]  While leaving Portuguese administrators in charge of day-to-day operations, Chinese representatives now had final say in important matters, allowing Beijing’s organizations to freely operate.  In 1989, when a Portuguese police official was asked about possible re-exports of US dual-use technology from Macau into the PRC, he said “This is their country.  We must respect their wishes.”[13]  

In recent times, PRC-appointed authorities have allowed those who would be suppressed as religious dissidents on the mainland to operate in Macau, but have pursued a vigorous counter-intelligence program—tightening up on organized crime and examining perceived use of at least one American casino by CIA to spot and recruit corrupt Chinese officials visiting Macau.[14]  This is at least one indication that the role of Macau as a haven for international intrigue is not yet over.





[1] Geoffrey C. Gunn, Encountering Macau: A Portuguese City-State on the Periphery of China, 1557-1999 (Boulder: Westview Press, 1996), pp. 96 and 99.  As a casual observer can see today (2014-16), Western religious groups and even the anti-communist Falungong religious movement openly evangelize in Macau, and the non-communist press contains articles sometimes critical of the casinos and the CCP-sponsored administration.

[2]  João Guedes, Macau Confidencial (Macau: Instituto Internacional Macau, 2015), pp. 113-119.  Gunn, Encountering Macau, pp. 96, 112-13 and 116, fn 60. 

[3] Gunn, Encountering Macau, pp. 117-18.
[4] Joao F. O. Botas, Macau 1937-1945, os Anos da Guerra [Macau 1937-1945, the war years] (Macau: Instituto Internacional de Macau, 2012), pp. 293-94 and 323.
[5] Guedes, Macau Confidencial, , pp. 147-49.  Gunn, Encountering Macau, pp. 118-128. 
[6] Xiao Zhihao, Zhonggong Tegong [Chinese Communist Special Operations] (Beijing: Shidai Wenxian Chubanshe, 2010), pp. 205-206.  Thanks to Dr. David Chambers for this reference.
[7] Guedes, Macau Confidencial, , pp. 166-67.
[8] Gunn, Encountering Macau, pp. 128-29.
[9] Gunn, Encountering Macau, p. 174
[10] Vasco Silverio Marques, Anibal Mesquita Borges, O Ouro no Eixo Hong Kong Macau, 1946-1973 [The Gold on the Axis of Hong Kong and Macau] (Macau: Instituto Português do Oriente, 2012), pp. 183, 217, 237, 246, 488.
[11] Fernando Lima, Macau: as duas Transições [Macau The Two Transitions] (Macau: Fundação Macau, 1999), pp. 600-605.
[12] Ibid, pp. 606-08.
[13] Interview.
[14] Barbara Demick, “Macau Bank Freeze Angers North Korea,” The Los Angeles Times, 7 April 2006.  Chris McGreal, “China Feared CIA Worked with Sheldon Adelson’s Macau Casinos to Snare Officials,” The Guardian, 22 July 2015.  James Ball and Harry Davies, “How China’s Crackdown Threatens Big US Casino Moguls,” The Guardian, 23 April 2015.  Sands China, Inc., “Findings of a Discreet Consulting Exercise in Macau, Hong Kong, and Beijing,” 25 June 2010, at http://www.documentcloud.org/documents/2170141-sands-asia-cia-report-redacted.html#document/p1 

Thanks to Prof. Cathryn Clayton of the University of Hawaii and eminent historian João Guedes in Macau for their comments.