Asian Godfathers: Money and Power in Hong Kong and South-East Asia


330 pages

by Profile Books, London


See Also: How to be a Godfather (Part 2)

ag_final-frontWe present
herewith the first of two excerpts from Asian Godfathers, a
unique book on the role of monopolies and crony capitalism in East
Asia. Much, mostly hagiographic, has been written about the
fabulously wealthy group of mostly overseas Chinese whose names are
familiar throughout the region and have been widely assumed to have
been responsible for its economic growth.

there have been few attempts to examine dispassionately the real role
of the great tycoons and the origins of their wealth, or to put them
into the context of the fast-growing, immediate post-colonial
societies in which they prospered.

Studwell, editor of the China Economic Quarterly, has done so and
with a flair for writing that is matched by an understanding of the
region’s economic and social dynamics. Studwell was previously
author of “The China Dream -- The elusive Quest For The
Greatest Untapped Market on earth.” an incisive look at the
myths and realities of the China market for foreigners.

shows again that Studwell is a master at separating
harsh reality from comfortable myth and, without muck-taking, to put
into print important if unpalatable facts which are known in elite
and media circles but which the power of the tycoons often keeps out
of the media.

The book
is currently on sale in all the countries/territories with which it
deals -- Hong Kong, Malaysia, Indonesia, the Philippines and
Singapore – with the sole exception of Singapore.

How to
be a Post-war Godfather

are so accustomed to disguise ourselves to others that in the end we

to ourselves
.” --La Rochefoucauld

post-Second World War, post-independence environment was one of great
turbulence. But the enduring interdependence of separate political
and economic élites was not broken. Certainly the era of
rising class consciousness and aggressive nationalism in the 1950s
and 1960s (and earlier in Thailand) was threatening to the overseas
Chinese and Indian communities. But the people who really suffered
were shopkeepers, small businessmen and laborers, not the godfather

organized labor and nationalism were reined in by a new group of
authoritarian leaders, it was striking how they not only fell back on
colonial era modes of interaction with ethnic minority businessmen,
but in many instances reinforced them. The challenge to the
godfathers therefore came not from any structural shift in society,
but in coping with the struggle for power among indigenous political
élites once the colonials had exited. In this respect the
tycoons’ ability to get into, and change, character was more
important than ever.

Thailand, Field Marshal Sarit Dhanarajata’s 1957–63
regime stabilized relations with Chinese and Indian trading élites
based on the military as their passive business partners. Although
the country’s post-1932 political history is superficially
chaotic – Sarit’s is only one of eighteen coups to have
taken place, the most recent being the ouster of Thaksin Shinawatra
in 2006 – after 1957 it was rare for incoming juntas and
governments to move against incumbent tycoons. Instead, the
godfathers became adept at backing all factions.

As Sarasin
Viraphol, Dhanin Chearavanont’s top executive at his sprawling
chickens-to-telecoms CP group, says, it is a matter of money and good
housekeeping: ‘We back everyone … And you would always
have a portrait of the military leader on the wall. That was general
practice. And of the commander of police, the commissioner for
metropolitan Bangkok …Even Chin Sophonpanich, who was so tight
with Sarit rivals and heroin traffickers Phao Sriyanonda and Field
Marshal Phin Choonhavan that he skipped town to Hong Kong when Sarit
took power in 1957, was allowed to continue building Bangkok Bank
into Thailand’s largest financial institution from exile. It
was, says Sarasin, a ‘gentleman’s game’ of coups.

There was
greater godfather discontinuity in Indonesia in the 1960s than there
was in Thailand after Sarit put an end to populist nationalism.
Following Sukarno’s chaotic nationalisation of foreign business
in the 1950s, the repatriation of tens of thousands of Chinese in
1960 and the anti-communist blood bath of 1965, Suharto turned
reflexively to the Chinese businessmen he was familiar with after he
seized power. This meant a handful of relatively unknown business
people being catapulted to the top of the godfather pile.

The most
important were long-time associate Mohamad ‘Bob’ Hasan,
an ethnic Chinese convert to Islam, and Liem Sioe Liong, also known
as Sudono Salim, who rose from petty trader to the nation’s
leading businessman in a few years. The precariousness of Suharto’s
position – or at least his perception of it – as he
shored up his power in the late 1960s made the relationship between
him, as the Javanese political insider, and his business cronies, as
unthreatening ethnic Chinese outsiders, all the more important.
Throughout his reign, Suharto was said by confidantes in Jakarta to
complain that pribumi businessmen could not be ‘trusted’;
the Chinese could. In time a small number of ethnic Indian and Sri
Lankan businessmen also became key dependents. The best-known of
these was the Sri Lankan Tamil Marimutu Sinivasan, a long-term
conduit for political slush funds for Suharto’s Golkar party.

Texmaco Group was able, on Suharto’s authority, to secure
US$900 million in hard currency from the central bank at the height
of the Asian financial crisis and, after the dictator fell, was said
by the Indonesian government to be its biggest delinquent creditor,
owing US$2 billion.

In the
Philippines another usurper, Ferdinand Marcos, demonstrated a similar
response to Suharto’s with respect to the possibilities of
godfather relationships. After winning two presidential terms in
(distinctly dirty) elections, Marcos circumvented his country’s
two-term presidential limit by declaring martial law in 1972. Like
Suharto, he also looked beyond the established godfather élite
– in the Philippines, traditional Spanish and Chinese mestizo
families – to find some of his key business proxies. The
archetype was Lucio Tan, a first-generation immigrant and one-time
janitor who became, under Marcos’ patronage, the Philippines’
leading tobacco vendor, as well as having interests in everything
from banking to real estate.

It is
probable that – as with Liem Sioe Liong, who knew Suharto from
the latter’s military postings in central Java – Tan and
Marcos knew each other from Ilocos, the president’s home region
where Tan had his first, small cigarette factory. Both Suharto and
Marcos signalled regime change by promoting new, non-indigenous
outsiders to godfather roles. Tan was a clear break in the ethnically
more mixed and integrated Philippines because he represented the
so-called ‘one-syllable Chinese’ – those who had
not assimilated and adopted local surnames.

promotion of new outsiders achieved two useful things for the
dictators: it provided ultra-dependent, ultra-loyal sources of future
finance for them and their families; and it served as a warning to
the established, more integrated economic élite that it was
not indispensable.

In the
pre-Marcos Philippines, businessmen of every ethnic make-up had been
increasingly successful in overrunning and manipulating a weak
parliamentary system and thereby obviating the need to make deals
with ultimate political power. Ferdy reversed this trend, though it
remains a latent tendency in both the Philippines and Thailand
whenever central leadership is weakened.

chronology ran later than those of surrounding nations, but still
observed a pattern of rising populist class consciousness and
nationalism followed by a return to nested relationships between
political and economic élites. Colonial rule did not end until
1957 and its last decade was bound up with a fight against a
significant communist insurgency, led by the largely ethnic Chinese
(with a few Indians) Communist Party of Malaya (CPM).

departure of the British gave way to an era of somewhat phoney
independence inasmuch as the colonial economic architecture was left
almost untouched; this was agreed to by the Malay aristocrats who
assumed power. Nationalism eventually arrived with the 1969 riots,
leading to the New Economic Policy (NEP).

promise of pro-bumiputera affirmative action, however, could
never disguise the persistence of what came to be known in Malaysia
as ‘political business’ at the élite level.
Affirmative action in education and employment targeted ordinary
Chinese and Indians – the latter were big losers because they
were turfed out of the civil service – while financial sector
policies benefited upper-class bumiputras. Rural bumpitutras remained
poor, while Chinese and Indian godfathers became richer than ever.
Racial ghettoisation was sustained, not least because the rising
political star of the 1970s, Mahathir Mohamad, saw it as all but
inevitable. Mahathir set out his unabashedly race-based views on the
roots of economic success in his book The Malay Dilemma, published in
1970 while he was briefly expelled from the ruling United Malays
National Organisation (UMNO), and banned in Malaysia. It is
indicative of Mahathir’s thinking that one solution he proposed
for Malays’ perceived genetic handicap was intermarriage with
other races. He himself had an Indian Malayali

from Kerala and a Malay mother, a fact that is never publicly
mentioned in Malaysia.

In popular
politics, Mahathir’s racial arguments were used to justify
affirmative action. But in terms of personal conduct, his own
prejudices shone through. After becoming prime minister in 1981, he
patronised a small group of ethnic Chinese and Sri Lankan Tamil
businessmen whom he deemed the people most likely to carry forward
his vision of a thoroughly modernized Malaysia. It was left to his
long-time political ally Daim Zainuddin to try to nurture bumiputra

Asia’s four major post-war autocrats – Mahathir, Lee
Kuan Yew, Suharto and Marcos – all had a fundamentally racist
view of life, and this was good news for godfathers.

When Lee
Kuan Yew became prime minister of Singapore in 1959, local godfathers
did have one problem: that he did not much like private businessmen.
Lee had no personal experience of business; he was a political
organizer brought up in an anglicised environment and influenced by
both the radical statist schools of the 1930s – communism and
fascism. As the Singaporean state expanded its economic reach,
opportunities to acquire private shares in cartels or monopolies were
reduced; they went to the government. On the other hand, Lee –
a super-élitist – was not about to let the boorish
proletariat upset his or the godfathers’ lifestyle. He
suppressed dissent, tamed unions and started to construct the world’s
leading nanny state.

incumbent tycoons – usually ones, like Lee, who were more
‘sophisticated’ and formerly closer to the colonial
establishment, such as bankers Lee Kong Chian and Wee Cho Yaw –
got on okay with the new leader. Others, like the
rougher-at-the-edges smuggler and speculator Kwek Hong Png, were less
palatable. But Kwek also owned a lot of assets, especially real
estate, in Singapore, and Lee Kuan Yew was not in the business of
forcible expropriation. There was room enough for the odd Kwek type
to prosper in tandem with a dirigiste city state.

In Hong
Kong, there were particularly vociferous calls after the Second World
War for the cancellation of knighthoods, for investigations and even
for trials of tycoons who were perceived to have cooperated all too
willingly with the Japanese. But the British had no replacement for
the anglicized Chinese and mixed-race Eurasian élite who
facilitated their rule, and they were swiftly restored. Local
newspaper editors were told to leave stories about collaboration with
the enemy alone.

In the
aftermath of the war, the tycoon group, along with its British peers
in the form of the leaders of the major colonial conglomerates, or
hongs, was instrumental in blocking tentative British plans for
democracy; that was the end of the local class threat for half a
century. Instead came the expanded, but largely impotent,
Legislative Council (Legco). Big business played out its political
role through its members

lobbyists appointed to the Legco. This pseudo-oligarchical system was
preserved by the British for the Chinese in 1985 – when the
Joint Declaration on resumption of Chinese sovereignty in 1997 was
agreed – by the creation of ‘functional’
constituencies, which allowed godfather interests in banking, real
estate, insurance and the like to place more lobbyists inside the

the Chinese set up their own ‘advisory committee’ on the
colony’s return, whose membership was dominated by tycoons. The
main point, however, is a simple one: whether Hong Kong has been
ruled by British colonialism, Japanese imperialism or Chinese
communism, it has always been managed through the same group of

Hong Kong’s claim to be a city of free trade, there has long
been plenty to play for in terms of tycoons’ political
activities. Information is always valuable, as seen in 1946 when
several establishment godfathers made millions from speculation in
Hong Kong dollars issued by the Japanese that were redeemed by the
returning British. A connection to political power was also essential
to the tycoons’ ability to present themselves as community
leaders who ‘understood’ the best interests of the
population at large.

But more
than anything in the post-war era, political influence was about
maintaining a heavily cartelized domestic economy which provided
generous economic rents to a small number of businessmen. Chinese
tycoons, as we shall see, already had a solid position in what was a
closely rigged real estate market. From the 1970s, local godfathers
began to wrest control of large parts of other cartels from the
British-controlled conglomerates that had developed them. It would
have been most unedifying if, in the transition of ownership, there
had been politically inspired moves to introduce more competition
into the local economy.

activity remained extremely important to the aspirant Hong Kong
tycoon. He served his own interests and those of the colonial
government simultaneously, and called his work ‘community
leadership’. During widespread strikes in the 1920s, then
senior godfather Sir Robert Ho Tung had mediated a seamen’s
dispute. Robert Kotewall and Shouson Chow, two other leading figures
who went on to receive knighthoods, helped organise street orators to
harangue Chinese laborers against joining strikes and ran a force of
heavies to protect those staying on their jobs from pro-strike

When the
proles raised their heads again in the late 1960s, in response to
China’s cultural revolution, the tycoons were on hand to lend
the government support and urge the population to resist overtures
from the Communist Party of China. As Leo Goodstadt, a former chief
policy adviser to the Hong Kong government, puts it: ‘The
political violence of 1967 in particular appeared to make the
survival of British rule more dependent than ever on the élite.
The British Foreign Office and the godfathers saw off the lower
classes, and the former’s Hong Kong governors were grateful
enough to prove highly resistant to liberal political and social
ideas emanating from London in the 1960s and 1970s.

Kong’s government and tycoons boasted instead to the world that
they had created a great laissez faire society; no one seemed to
notice that this was simply not the case in the domestic service
sector and construction parts of the economy occupied by the

On the
Couch, Please

When the
dust settled on post-colonial Southeast Asia, the godfathers were
back where they had always been – managing shifting political
relationships in order to profit from particularistic favors and
government-induced economic distortions.

So what
kind of people, up close, are the post-war godfathers?

Only one
really compelling piece of empirical research has been completed
about the social and cultural backgrounds of Southeast Asian tycoons
in the past half century. It limited itself to the ethnic Chinese
godfathers of Thailand, but nonetheless contains results that
resonate for other immigrant groups and other societies. In the mid
1950s, an American scholar, G. William Skinner, achieved an
extraordinary level of access to Thailand’s tycoon fraternity.

enlisted the help of two Chinese bank compradors and other
well-informed sources to identify the 135 most powerful ethnic
Chinese businessmen in Thailand and he succeeded in interviewing 130
of them. He was equipped with fluency in both Thai and Mandarin
Chinese, and knowledge of southern Chinese dialects, as well as
astonishing tenacity. No academic or journalist has produced a survey
of such quality since.

results pointed unequivocally to a group of men stuck in a cultural
middle ground between a Chinese immigrant population they sought to
represent as community leaders and a Thai political élite to
which they acculturated as a means of gaining concessions and
advancement in business. A major finding was that most of the
businessmen were less ‘Chinese’ – in terms of
language, customs, education – than was expected. With respect
to the relationship of the tycoons to the core Chinese community,
Skinner proposed a concept of ‘leadership from the periphery’
to capture the fact that the godfathers were leading their
communities by dint of wealth and influence, despite being culturally
distant from them.

of the major theses of the present study,’ he wrote, ‘[is]
that a significant number of the most influential Chinese leaders
are, almost inevitably, leaders from the periphery of Chinese society
and culture – men whose ethnic orientation and loyalties are

research highlighted all kinds of complexities in the identities of
his godfather subjects that are brushed over by normal stereotypes of
the ‘Chinese tycoon’. There emerged a broad correlation
that the more wealthy and influential a ‘Chinese’ tycoon
was, the less demonstrably Chinese he turned out to be. Skinner
developed tables that plotted wealth and prestige (as assessed by
peers) against the degree of assimilation to Thai culture among his
subjects. There was no doubt that success was to do with moving away
from ‘Chinese-ness’ and towards the culturally Thai
identity of political power.

At the
same time, there was a requisite amount of Chinese-ness for remaining
a leader of the ethnic Chinese community that also supplied the key
personnel in tycoons’ businesses.

possibly, lie the contradictory forces that have informed the
identities of godfathers around the region. Without an empirical
study like Skinner’s across different states, such a thesis
cannot be demonstrated scientifically. But the anecdotal evidence
gathered for this book supports the proposition that godfather
personalities are stretched and confused.

A relative
of Henry Fok – a man who early in his career was close to the
British establishment in Hong Kong before becoming close enough to
the communist establishment in Beijing to be appointed vice chairman
of the Chinese People’s Political Consultative Conference –
says tycoon behavior should be viewed through the prism of Eric
Berne’s 1960s bestseller The Games People Play, adding:
‘They all want a shrink … to get it off their chest.’

developed a branch of psychotherapy called Transactional Analysis,
which highlights the malleability of identity. Henry Fok, who died in
a Beijing hospital in October 2006, knew all about multiple
identities. He underwent anglicization on a British government
scholarship to an élite school in Hong Kong, becoming an
accomplished tennis and soccer player, and continued his family’s
acculturation by sending his sons to the English public school

But as
parts of the British establishment spurned him because of his huge
smuggling operations in the Korean War, and Beijing rewarded him with
monopoly trading concessions for the same activity, he was reborn as
a rabid Chinese nationalist. Forbes magazine tried for years to set
up an interview with Fok, who only cared to speak with mainland
Chinese journalists he knew would publish official encomia.

When he
finally agreed to a meeting in Zhuhai, he got out of his car long
enough to make the following statement: ‘Once old countries go
down – like India, Egypt, even Britain – they never come
up again. But China will come up again.’ He then jumped back
into his car and sped off, leaving Forbes very short of copy.

role-playing that is part and parcel of the godfathers’ lives
may explain the insecurity that appears to afflict them. One facet of
this is an obsession with status. Asian godfathers collect and
display gongs – honorary titles, doctorates, and so on –
with a hunger that puts Western billionaires to shame.

Ho, for instance, insists that underlings refer to him at all times
as ‘Dr Ho’; Henry Fok used to insist on ‘Dr Fok’.
This is incongruous for gambling tycoons; as one of Stanley’s
assistants announces on the telephone, in English, ‘Dr Ho’s
office’, one can frequently hear Cantonese yelling and the
sound of his tribe of bodyguards in the background.

Malaysia, the senior billionaires combine the various titles that
federal and state authorities give them with those from academia, and
style themselves with triple honorifics. As an example, Khoo Kay
Peng of Malayan United Industries (MUI) is ‘Tan Sri Dato Dr
Khoo Kay Peng’. Observing the same tendency in Thailand, where

tycoons have long craved titles bestowed by the royal family, Skinner
highlighted research into social psychology. Work on minority group
situations, he noted, shows that people who undergo a high degree of
assimilation are particularly driven to acquire the full set of
prerogatives available to the group to which they have assimilated.
‘The most influential Chinese leaders, in point of fact,’
wrote Skinner, ‘are more susceptible than other Chinese to
pressures toward further assimilation.’ The symbols of
recognition that constitute official titles therefore become terribly

But the
godfather crisis of identity goes beyond honorifics (and a weakness
for outsize penthouse offices – they like to be literally on
top). One controversial theme is the frequency with which the tycoons
are attracted to evangelical Christianity. Thomas and Raymond Kwok of
Sun Hung Kai and Ronnie Chan of the Hang Lung group in Hong Kong,
Khoo Kay Peng of MUI and the Yeoh family of the YTL group in
Malaysia, the Riadys of the Lippo group and the Soeryadjayas who
controlled Astra in Indonesia are just some of the region’s
many born-again Christian billionaires.

Among the
most aggressively proselytising is Khoo Kay Peng, a friend and
business partner of US televangelist Pat Robertson, who bought a
disused Kuala Lumpur theatre to serve as a chapel and started a
Businessmen for Christ group. The Riadys built a private chapel in
Hong Kong’s Lippo Centre office tower, to which they have
invited potential converts; a long-time family friend says he lives
in fear of being hauled in there. Some of those who know the
Christian tycoons are cynical about their religious beliefs, but this
does not answer the question as to why a substantial section of the
tycoon fraternity is drawn to evangelical religion.

Francis Yeoh himself says that Christianity counters the excessive
individualism inherent in Chinese culture; the Chinese, he complains,
are like, ‘amoeba’. Indonesia Edwin Soeryadjaya, eldest
son of family patriarch William, says of Christianity’s
attraction: ‘One reason could be there is no certainty in this
country. So who do you put your faith in?’ What no godfather
believer suggests, but what may also be true, is that evangelical
Christianity allows them to have a strongly held belief where their
daily lives are all about expressing no belief at all unless given a
cue by political power.

It is also
possible to believe in religion without upsetting Asian politicians,
whereas to have independent political or social views is disastrous.
One more thing that appears to be an expression of insecurity among
Chinese godfathers is an obsession with demonstrated ‘Chinese-ness’
and with eugenics; this has only become more apparent recently as
China has re-emerged as a regional power.

best-known case study is Lee Kuan Yew, a tycoon of sorts by virtue of
the fact that he nationalized and ran much of Singapore’s
economy after 1959. Lee had an English education, attending the élite
Raffles Institution and Raffles College in Singapore as well as
Cambridge University (institutions that educated various Malaysian
and Singaporean tycoons-to-be, including Robert Kuok and Quek Leng
Chan). Back then he was called Harry Lee. In 1967 he told an audience
in the United States: ‘I am no more a Chinese than President
Kennedy was an Irishman.’

But as
Singapore became prosperous and China began to open up in the 1980s,
Lee became ever more exercised in explaining his city state’s
success in terms of Confucian culture and ‘Asian’ values.
He had learned Mandarin and Hokkien Chinese in the late 1950s and
early 1960s as he framed his popular political persona, and the
identity of Harry Lee was buried. In its place came the Lee Kuan Yew
who warned Singaporean students in 1986 that they must never lose
‘their Confucian tendencies to coalesce around the middle
ground, that day we become just another Third World society’.

As the
historian of the overseas Chinese Lynn Pan has written: ‘The
remaking of Singapore in the Confucian image is in some ways a larger
embodiment of a personal enracinement.’ Lee’s identity
odyssey has seen him become increasingly enamored

of the
kind of racist eugenic theories that were popular in Edwardian

He set up
a state matchmaking agency in Singapore, the Social Development Unit,
to help pair off mates of similar intelligence, and argued for a
return to the upper-class polygamy of traditional Chinese society.

Lynn Pan
refers to journalist T. J. S. George’s observation that ‘he
detected in Lee the insecurity of a man alienated from his Chinese
moorings, a man who, because he does not quite belong anywhere, has
had to remake Singapore in his own image to

for his own alienation’.

It is not
difficult to understand the psychological pressure that goes with
being caught between different cultures. The typical godfather needs
to be a polyglot who can play out more than one cultural identity to
succeed: a big-time Chinese tycoon will speak two or three regional
Chinese languages – Cantonese, plus a couple more – as
well as Mandarin Chinese, English, a native Southeast Asian language
like Thai or Bahasa Indonesia, and probably some Japanese picked up
in the war. There is a perpetual stress that goes with this, related
to what one’s ‘real’ identity is. Lee is still hung
up on the fact that his Chinese is not as good as his English.

This is a
condition that affects many Chinese educated in the British system.
David Li of Hong Kong’s Bank of East Asia, who was sent away to
an English public school, is sensitive about the fact that his grasp
of written Chinese is far from complete. Budi Hartono, ethnic Chinese
CEO of the Djarum tobacco empire and one of the richest tycoons in
Indonesia, was schooled by Dutch colonists and still reads and writes
Dutch better than he does Bahasa Indonesia; he speaks no Chinese.
Conversely Dhanin Chearavanont, the ethnic Chinese patriarch of
Thailand’s CP group, is perpetually embarrassed that his Thai
is still heavily accented with Chinese even though his family has
been operating in Thailand since the 1920s.

On top of
this discomfort is the racial prejudice that men of the senior
godfathers’ generation suffered in the colonial era. The
patronising attitude of the British colonial administration in
Singapore cannot have been easy to endure for a man of Lee Kuan Yew’s
ego. Robert Kuok, who has become well known to associates for his
genetic theories and strident racial views, was sent to a convent
school as a child where nuns told him his family’s visits to
Buddhist shrines were a form of devil worship.

Kuok’s élite British education – English College
in Malaysia’s Johor Baru and Raffles College in Singapore –
and his emergence as a ‘born-again Chinese’ in the
independence era, mirror the trajectory of Lee Kuan Yew. Kuok became
a major sponsor of overseas Chinese ‘conferences’ in the
1990s; he signalled the purity of his second marriage (the first was
to a Eurasian woman) by giving their children only Chinese names; and
he became ever more forthright in proposing the genetic basis of the
economic success of the overseas Chinese.

Where cold
analysis of the success of men like Lee Yuan Kew, Robert Kuok and
Henry Fok finds its roots in their cosmopolitan-ness – their
ability to work in different languages and cultures – they
themselves have sought a monocultural explanation. This can be
uncomfortable for godfather children, many of whom – befitting
the cross-cultural environments they grew up in – are married
to non-Chinese. An in-law of Robert Kuok describes him as the
‘biggest racial bigot I’ve ever met’.

The larger
point, however, is that the godfathers are engaging in a double
self-deception. The first is to pretend that the Southeast Asian
economic development story is a Chinese one where it is an immigrant
one. The second is to avoid the fact that they – the tycoons –
usually had the kind of practical advantages among their immigrant
peer group that assist success the world over.

to Skinner’s work on Thai tycoons, it is obvious what those
advantages are. Skinner’s subjects were better-educated than
popularly believed: ‘With regard to educational attainment, the
leaders unquestionably form a privileged group within Bangkok Chinese
society,’ he writes. And only a fifth of them could be
described as ‘self-made from scratch’. The fact of such
widespread advantage of birth is the context of the godfathers’
most striking dissemblance – their determination to demonstrate
a rags-to-riches genesis.

We of
Humble Origin

have long been at pains to establish their status as self-made men of
humble origin. As seen above, the regimes of Suharto and Marcos did
produce genuine working-class-to-billionaire stories as the dictators
reached for unknown outsiders to become their trusty accomplices in
divvying up the economic spoils of power. But this was not the norm
in more settled political climes. If there is a class stereotype for
Southeast Asian godfatherdom, it would be that of a rapid-cycling
economic aristocracy.

well-known Chinese proverb refers to three-generation wealth, in
which one generation makes a fortune, the next holds on to it and the
next loses it. Actual experience in the past hundred years points to
a four-generation sequence, in which the first generation establishes
a kernel of capital that a second generation, with improved ties to
political power, leverages into a serious fortune. A third generation
then tries to hold on to an extremely diversified range of assets
that reflect the unique personality and relationships of the father.
By the fourth generation a lack of application to this task, the
decay of the original relationships on which the empire was built,
and the inherent weakness of businesses based on family rather than
professional management bring the edifice down.

rags-to-riches stories are exceptional. The domestic economies of
Southeast Asia are far too closely controlled by governments to make
such a thing likely. As Adrian Zecha, a Chinese–Dutch–Malay–Czech–
Thai–German–Indonesian luxury hotelier and socialite who
knows most of the contemporary tycoons, says of the path to
godfatherdom: ‘In one generation it is very difficult because
it is not an open economic society. You get that in America. To a
lesser extent in the UK. To a lesser extent still in continental

Gungwu, a prolific writer on the overseas Chinese based at the
National University of Singapore, concurs: ‘I have yet to find
a businessman who started as a coolie.’

this, there is a long tycoon tradition of mythologizing a humble
background and a struggle to escape the clutches of poverty. A
classic example is Thailand’s richest businessman, and recent
premier, Thaksin Shinawatra. In speeches and official publications
Thaksin relates tales of a hard-scrabble upbringing and underfunded
schools with broken equipment. He proclaimed in a speech in Manila in
2003: ‘Through my modest family background … I learned
the hardship of poverty in the rural areas. I learned the importance
of earning rewards by working hard.’

reality, Thaksin’s family is a well-established dynasty from
Chiang Mai that was involved in tax farming before 1932, and moved
into the silk business as well as finance, construction and real
estate thereafter. Thaksin himself went through the best local
schools and military academies and married a general’s
daughter. His rise through the ranks of the Thai police force and
access to state concessions were very

much an
insider’s story.

In Hong
Kong, Asia’s richest tycoon, Li Ka-shing, revels in his
reputation as the son of a schoolteacher who arrived in Hong Kong
penniless in 1940. The official website of his Cheung Kong Holdings
instead states: ‘Shouldering the responsibility of looking
after the livelihood of the family, Mr Li was forced to leave school
before the age of 15 and found a job in a plastics trading company
where he labored 16 hours a day. By 1950, his hard work, prudence and
his pursuit of excellence had enabled him to start his own company,
Cheung Kong Industries.’

reality, Li went to school for a couple of years and then started
working for a wealthy uncle (from the family that owns Hong Kong’s
Chung Nam Watch Co.). Subsequently he became part of an important
subcategory of tycoons who got ahead, in part, by marrying the boss’s
daughter. Li’s late wife, Amy Chong Yuet-ming, was a first
cousin – the wealthy uncle’s daughter. The business where
Li worked in fact belonged to his father-in-law; and what Li did was
to build the operation up. According to a long-time intimate of
Li’s, his mother-in-law also gave him additional financial

the boss’s daughter is not uncommon in godfather development.
One well-known example is Singapore’s Lee Kong Chian, who in
1920 married Tan Kah Kee’s daughter and prospered for the next
seven years as treasurer of the old man’s business before
breaking out on his own. C. Y. Tung, founder of the shipping company
Orient Overseas Line and father of Hong Kong’s first
post-colonial chief executive, Tung Chee-hwa, married into money in
the form of Shanghai’s wealthy Koo family.

Among the
current generation, Cheng Yutung of the New World group married into
Hong Kong’s ubiquitous Chow Taifook jewellery business; the
company remains his key private vehicle. For the would-be godfather
who cannot rely on his father’s wealth to prime a career in
business, the recourse has been the wealth of a wife’s family.

should be no great surprise about this given the social élitism
of Southeast Asian societies. Yet it is curious how bound up tycoons
are with the rags-to-riches myth. Sir David Li, billionaire head of
the Bank of East Asia family in Hong Kong and normally an astute
observer of the world around him, is adamant that many tycoons are
self-made. Reaching for examples, he cites the film and television
magnate Sir Run Run Shaw, Lee Shau-kee of Henderson Land and Henry

But Run
Run Shaw and his brothers are sons of a Shanghai textile magnate, Lee
Shau-kee comes from a wealthy banking and gold trading family from
Shuntak county in Guangdong province, and Henry Fok – though
from a genuinely working-class background – was set apart by a
British government scholarship to an élite school.

Without a
Marcos or a Suharto to shake things up, Asian godfathers are not the
products of great social mobility. The notion that they are, however,
is part and parcel of the tycoons’ self-image. It is important
to their personal sense of pride and it is critical to the
maintenance of authoritarian political structures and unfree markets
in the region which constrain opportunities for many other talented


that further confuses the popular image of the tycoons is their
reputation for thrift. Part of this is justified and another part is
very much for public consumption. The genuine thrift is that which
reflects an entrepreneur’s instinctive desire to preserve
capital. As one lifelong Asian investment banker and tycoon intimate
observes: ‘They are better at denying themselves immediate
earthly rewards than your average investment banker.’

As an
example, Robert Kuok bought a mansion on Hong Kong’s Deep Water
Bay Road (a sort of Tycoon Alley close to a nine-hole golf course
favored by the godfathers for their early morning rounds) during the
Asian financial crisis for the knock-down price of HK$80 million. He
tried living in the house but, according to family members, became
obsessed with the notion that the property was excessive, even for a
man worth several billion dollars. Eventually he knocked the house
down, built five modest townhouses in its place, took one for
himself, two for his family and rented out two more. Kuok lives in
the kind of house that in Europe or the United States would be
associated with a modestly successful bank manager.

are also keen to telegraph useful messages to employees and service
providers. An investment banker in Malaysia recalls a meeting in
London in 1999 with Lim Kok Thay, son of gaming billionaire Lim Goh
Tong, to seal the US$2 billion acquisition of Norwegian Cruise Line.
Leaving the lawyers’ office in the City, Kok Thay hailed a taxi
which the banker assumed would take them to Heathrow airport for a
flight they were due to catch to Norway. After half a mile, however,
the billionaire heir ordered the cab to stop and ushered the party
into an entrance to the London Underground. He saved a few pounds by
riding the train to the airport. Once at Heathrow, the nonplussed
investment banker found the group were booked into economy class
seats for the flight to Oslo.36

K S Li (as
Li Ka-shing is often known in Hong Kong) likes to point to his modest
appetites by reminding people about the cheap Seiko and Citizen brand
watches he has worn over the years – ‘that fucking
watch’, as one of his executives who has heard the reference
once too often remembers. A cheap timepiece has become his symbol. In
a rare interview with Fortune magazine, Li inevitably wheeled out the
watch theme: ‘Yours is more luxurious,’ he pointed out to
the interviewer. ‘Mine is cheaper, less than US$50.’

Apart from
the instinct to preserve capital, and the sensible business tactic of
displaying thrift to employees, however, there is a good deal of cant
about the supposedly modest lifestyle of the average godfather.
Another source of public pride for Li Ka-shing is the fact that he
draws tiny salaries from his public companies – just HK$10,000
from his flagship Cheung Kong Holdings in 2005. It is never mentioned
that in Hong Kong there is tax on salaries but not dividends, so
there is a tax-avoidance incentive for tycoons to live off the

Churchouse, a former managing director at Morgan Stanley in Hong
Kong, points to the case of one of K. S. Li’s peers: ‘Lee
Shau-kee,’ he says, ‘has been taking US$150 million to
US$300 million in dividends just from [flagship company] Henderson
[Land] for twenty years.’ Among other things, Lee has used the
money to buy 30,000 apartments in the United States. These are not,
in the final analysis, men living off small incomes.

The real,
secret profligacy of the tycoon fraternity is their high-stakes
gambling. Most members of the tycoon fraternity claim that all other
members (not themselves, naturally) are at it all the time. ‘They’re
all big gamblers,’ says one Hong Kong-based billionaire. ‘The
only ones who are not big gamblers are [gambling godfathers] Stanley
Ho and Henry Fok.’

bankers in Hong Kong and Singapore trade endless rumors of golf games
played for US$1 million a hole. Or vast losses accumulated on gaming
trips to Australia and the US. Of course, nothing makes it into the
media because tycoons do not make bets in public. But the rumors are
legion and suggest a form of gambling that echoes that of Middle
Eastern potentates – vast sums of money blown away by people
who do not know its real value because they have not really earned


What is
incontrovertibly true about the godfathers is that they hold to
male-dominant, patriarchal traditions of the family with a vengeance.
In running family businesses they demand total obedience from
relatives and use a variety of tactics to secure it. Among the most
effective is to keep children and other relatives loyal with the
prospect of vast inheritances, while simultaneously keeping them

Ng Teng
Fong, Singapore’s biggest private landlord and
multibillionaire, is not untypical. His eldest son Robert runs Sino
Land, the Hong Kong end of the family operation and itself one of the
half dozen biggest developers in the territory. Robert, educated at
an English boarding school and now in his fifties, still lives in an
apartment rented from the company and owns only about US$1 million of
Sino Land equity.

his father telephones each day to check on the business’s cash
balances. Younger brother Philip is kept on a similarly tight leash
in Singapore.

Vatikiotis, former editor of the Far Eastern Economic Review and the
journalist who gained closest access to Thailand’s reclusive
Chearavanont family, recalls having dinner with the patriarch and his
middle-aged sons, who were not allowed to speak. An investment banker
who has worked with the Chearavanonts paints a similar picture, in
which the sons find ‘they have to beg for a new car’.

factor that ensures patriarch power in Chinese families is that there
are no rules as to who will take over what part of the family
fortune. It is a common misperception that there is some form of
primogeniture at work. In reality, an eldest son is only a business
heir if he is deemed worthy of the position. It is quite normal to
pick a different sibling, although males always come before females.

casino magnate Lim Goh Tong, for instance, chose Lim Kok Thay over
his elder brother. Indonesia’s Liem Sioe Liong bypassed his
eldest son Albert when he designated Anthony Salim as heir. Henry Fok
sidelined his eldest son Timothy in favor of his sibling Ian. Younger
sons are less likely to disappear when they know they are not
necessarily out of the running to become the big boss.

culture of the family business can be stifling, and is often a recipe
for much unhappiness, but it is almost never challenged. Moreover
this cuts across all kinds of sociologies, unaffected, for instance,
by whether a family is mixed-race or whether the godfather went to a
colonial school. The patriarch is always king. On the outside this
manifests itself in what Helmut Sohmen, the Austrian son-in-law of
the late shipping magnate Y K Pao, calls ‘the love of
pre-eminence’. The same notion is captured in K S Li’s
frequent description of himself as ‘the friendly lion’.

In this
respect, the Southeast Asian tycoon aspires to benign godfather
status. But while this may be possible in terms of public perception,
actual authority within families – and often companies –
is all too often wielded by mundane bullying. The middle-aged
children of major tycoons like K. S. Li and Robert Kuok live in fear
of their fathers’ outbursts. An executive of Li’s
recalls his eldest son Victor dozing off in a meeting to be awoken as
if by electric shock by his screaming father. Board members at the
South China Morning Post, controlled by Robert Kuok, were not sure
where to look at an infamous February 2003 board meeting when the
patriarch lost his

with son Ean, then aged 48, bawling him out in front of a room full
of directors. Another Hong Kong-based multi- billionaire, meanwhile,
has been seeking to control his outbursts with the help of a
behavioral therapist.

are by definition busy people and it is expecting a lot of them that
they should achieve what has become known as a ‘work–life’
balance. But the unbridled, unquestioned power of the patriarch is a
corrupting influence on family relationships. K. S. Li’s
younger son Richard has been a rare example of semi-active rebellion.
He was sent away to boarding school aged twelve and his mother is
widely believed in Hong Kong to have committed suicide.

unauthorised Chinese-language biography published in 2004, which can
only have been informed by Richard Li’s inner circle, dwells on
his close relationship with his mother, the process by which he set
up his own company and then took over Hong Kong Telecom without
informing his father, and the fact that he describes Lee Kuan Yew –
not Li Ka-shing – as his hero. The message to a Chinese
audience is extremely clear: that father and son do not fit the
harmonious cultural stereotype.

Tim Fok,
eldest son of Henry Fok, gives away something of the nature of tycoon
family life when he describes the bizarre experience of coming home
from English public school for the holidays aged sixteen and being
sent off by his father to buy the first Hitachi jetfoils for the Hong
Kong–Macau ferry route. It is difficult not to sense that there
is an element of bitterness when he concludes: ‘I think my
father was more interested in going to nightclubs.’

defines the godfather’s power within the family as much as his
license to indulge his sexual appetite at will. Henry Fok, who died
in 2006, and Stanley Ho both took several wives – polygamy was
not outlawed in Hong Kong until the Marriage Reform Ordinance of
1971. Many tycoons enjoy multiple mistresses and copious amounts of
extramarital sex. One of the richest men in Asia is remarkably candid
in saying that in the godfather lifestyle sexual liaisons are the
main punctuation between periods of time spent at the office: ‘It’s
all business,’ he says. ‘None of these people has social
friends. They fuck a girl, shake off their horniness and then it’s
back to work.’

Of course
he is not quite candid enough to admit the observation applies to him
as well, though a member of his family assures that it does: ‘If
they don’t have a woman a day they can’t function,’
the person says of the tycoon fraternity.

It would
be unduly prurient to dwell on the mechanics of how seventy- and
eighty-year-old men organise a constant supply of fresh sexual
activity, but suffice it to say that billionaires who own entire
blocks of apartments, hotel chains and gin palace yachts have plenty
of private space away from home.

There is a
long tradition of the godfather-as-stud. Pre-war Indonesian tycoon
Oei Tiong Ham’s daughter wrote of her father: ‘All his
life he had great interest in women and sex. He had eighteen
acknowledged concubines and a total of forty-two children by
them.’Today’s peer group is somewhat more modest, though
Indonesia’s Eka Tjipta Widjaya is associated with at least
thirty children. Stanley Ho has only seventeen acknowledged children.

the Asian tycoon still enjoys unusual sexual licence. As one veteran
Hong Kong investment banker puts it: ‘Sexual rapaciousness is
endemic to their culture … the fact that their wives say
nothing about it sets them apart from Western billionaires’.
This does not mean, however, that children are unaffected. What is
noticeable in several godfather families is how resentful and
affected male children have become because of their father’s
sexual profligacy and its effect on their mothers. What is equally
noticeable is that those male children have grown up to be sexual
profligates themselves.

without Accountability

The final
component of the standard godfather make-up is secrecy. This is
almost invariably presented as a reflection of Asian and Chinese
culture, not least by the tycoons themselves. A 1991 Robert Kuok
letter to the Far Eastern Economic Review refusing an interview is
typical. ‘The average Chinese,’ wrote Kuok, ‘is
publicity shy for various reasons, is averse to indulging in washing
linen in public and, consequently, also averse to dealing with the

But behind
the recourse to cultural defences by thoroughly cosmopolitan men like
Robert Kuok lies a larger truth: that dealmakers such as him and
secrecy go hand in hand in any society. It is worth remembering how
the old private banks that dominated international finance in London
and New York at the end of the nineteenth century – Warburg,
Rothschild, Morgan and others – did not even put nameplates
outside their headquarters. The main office of J. P. Morgan &
Company at the corner of Broad and Wall in Lower Manhattan had
nothing more than the number 23 on the door.