Tan Sri Frank Tsao Wen-King

 

The Maverick Mariner

 

In the 1980s, Singapore was looking to turn itself into a maritime hub but did not know how to do so. The government asked Chinese national Tan Sri Frank Tsao under what circumstances would he, the number three in Asia’s shipping world, would relocate his business here from Hong Kong. As a result, International Maritime Carriers’ (IMC) entry into Singapore drew many other shipowners here and they ended up treating the island-state as more than just a port-of-call.

 

Shanghai-born Tan Sri Frank Tsao Wen-King was born into a rich family. His grandfather started a successful transportation business along the banks of the Huangpu River in Shanghai and his father developed it. But most of the family’s wealth was wiped out during World War II. When the war ended, Tsao married his childhood sweetheart Maisie Chow. China soon descended into civil war. To escape the turmoil, the family fled to Hong Kong in 1949. Tsao was only 24 years old then but as the oldest of five children, he bore the responsibility to provide for his family. Till today, Tsao recalls the uprooting with deep anguish and tears. Leaving Shanghai, which he still thinks of as home, remains a painful memory.

A year on in Hong Kong, during a walk by the waterfront with his father-in-law one evening, Tsao saw two ships unloading cargo. It was an ordinary moment but it had an impact on Tsao. He was inspired to continue with his family’s trade in the hope of running his own maritime shipping line one day. He went on to buy his first ship and set up a shipping company, Great Southern Steamship, with a partner. Though the business partnership fell apart later due to differences in leadership style and Tsao dissolved the company, he subsequently set up IMC in 1966. In the next few decades, Tsao amassed a substantial fleet and became a major player in the industry.

In the 1980s, uncertainty surrounded Hong Kong’s future. Hong Kong, then a crown colony administered by the British, was due to be returned to Chinese sovereignty in 1997. Against this backdrop, many businesses were looking for opportunities outside Hong Kong. At that time, Singapore wanted to fashion itself as a maritime hub and needed a reputable ship operator to make Singapore its base. David Chin Soon Siong, then-director of Trading and Services at the Trade Development Board (now International Enterprise Singapore), was tasked with wooing Tsao here. Tsao pointed out that Singapore’s tax policy was a deterrent to shipowners.

“I asked Tsao what we should do and he told me, ‘sit down with me in Hong Kong’,” Chin recalled. Over a few visits, Chin went to Tsao’s office, looking through IMC’s entire financial accounts to understand the operations of a mega shipping company. Tsao then suggested that Singapore create a scheme where foreign flagged ships registered outside Singapore could receive tax incentives here. He walked Chin through the design of the scheme.

The Singapore government heeded his advice and the Approved International Shipping Enterprise Scheme (AIS) was unveiled in 1991. It aimed to draw more major international ship operators here, as their spending would stimulate the economy and their presence would encourage the development of an array of ancillary services such as ship financing. Previously, only Singapore-flagged ships were entitled to tax rebates. Chin said that AIS was a very comprehensive scheme thanks to Tsao. “He taught me the tricks of the trade,” Chin added. Not only did Tsao help devise a scheme that benefited IMC, he also told Chin how the scheme could be expanded to interest his competitors. "Tsao's generosity was one of the many reasons why he was given the honorary citizen award [in 2008],” said Chin.

Shipowners from all over the world were thus incentivised to move their operations here. IMC was the first to come on board, with 70 ships and its corporate headquarters moving to Singapore. Other shipping companies soon followed suit. Today, 130 shipping groups call Singapore home. As of June 2015, the maritime industry contributed 7% of Singapore’s GDP and employed more than 170,000 people.

By helping Singapore become a maritime hub, Tsao shifted the shipping industry’s attention from the West to Asia. When the Asian Shipowners Forum (ASF) was formed in 1992, Tsao lobbied for a secretary-general to represent the voices of the members and for the organisation to be headquartered in Singapore. Over the next 15 years, he visited all 13 member countries to convince them to build the ASF headquarters in Singapore. In 2007, the ASF opened its office in Singapore. In so doing, Singapore became the centre of Asia’s shipping business.

The shipping magnate was also one of the five major backers of Suntec City. The other four were Hong Kong tycoons Sir Run Run Shaw, Li Ka-Shing, Lee Shau Kee and Cheng Yu-Tung. According to Tsao’s autobiography, My Sixty Years: Turbulent Sailing, Prime Minister Lee Kuan Yew called on this group of businessmen when he visited Hong Kong in 1984. He asked, “You have made investments in Europe and America. Why don’t you do the same in Singapore?”

The five tycoons discussed Lee’s request and came up with the idea of an international convention and exhibition centre, which became known as Suntec City. As Tsao was most familiar with Singapore, he was nominated to be the Chairman of the Suntec Group.

Suntec City was an investment made during a time of economic recession. But the five men believed that Singapore would recover from the downturn. It cost the group of tycoons $2 billion to build the development, which had five tower blocks, a retail and entertainment zone and 1 million sq ft of convention and exhibition space. In 1996, the inaugural World Trade Organisation ministerial conference was held at Suntec. Other meetings and international exhibitions have been held there since.

Suntec City was designed by I.M. Pei and Partners, local firm DP Architects, and Tsao’s younger son, Calvin, of New York-based Tsao & McKown Architects. Calvin Tsao is a renowned architect who has renovated several buildings in Beijing’s Forbidden City. Tsao’s elder son, Frederick, has taken over his business at IMC. His elder daughter, Dr Mary Ann Tsao, runs some of the family businesses and the family’s Tsao Foundation founded in 1993 by her father and grandmother, Mrs Tsao Ng Yu Shun.

Tsao does not live in Singapore full-time, shuttling between Hong Kong and Singapore. His late mother lived in Hong Kong. But the family chose to set up their foundation in Singapore because it is corruption-free, said Tsao. The foundation is well-known for its focus on improving the quality of life of elderly folk. It does this through healthcare and counselling services for the elderly, training eldercare professionals and conducting research into innovative ways to further promote the well-being of the elderly. Among its many projects is an integrated community health and social care system that allows older people to “age in place”.

Asked in an interview if he ever envisioned the success he has achieved, Tsao said that in the immediate aftermath of World War II, he felt as though he was “sailing against the wind”. Today though, it is clear that the path he charted has not just anchored him in success, but has also benefited Singapore in different ways.

References

Frank W.K. Tsao, My Sixty Years: Turbulent Sailing
(Hong Kong: IMC Group Publishing, 2010).

Maritime Port Authority Singapore,. 2015. National Geographic Channels Present ‘INSIDE MARITIME SINGAPORE’, http://www.news.gov.sg/public/sgpc/en/media_releases/agencies/mpa/press_release/P-20150626-1.html.

Lee Kuan Yew, Senior Minister, Grand Opening of the Singapore International Convention
and Exhibition Centre (Speech at Suntec City Opening, Singapore, August 30, 1995),
http://www.nas.gov.sg/archivesonline/data/pdfdoc/lky19950830.pdf

 

 

Tan Sri Frank Tsao Wen-King
China, b.1925