Saturday, July 02, 2016

Brexit Wrecks it

Can't find true love. I know just the place...

UBS observed:
“We had expected the electronics-heavy Taiwan market to report its worst earnings figures in Asia and EM this year – a 5% y/y decline due to weak external demand and, more importantly, muted consumer electronics product cycles. Brexit is likely to make matters worse for Taiwan, since it has the highest revenue exposure (15%) to Europe among Asian countries, resulting in further earnings downside risks.
I was on ICRT on Friday (podcast) but more importantly, Michael Boyden, the longtime business and finance expert here was on talking about Brexit (and very hilariously too). He emphasized that Taiwanese firms had entered the UK to use it to enter Europe, so all those firms will take a hit shifting elsewhere in Europe.

Today I rode with a friend of mine who owns a firm that exports motorcycle accessories to Europe. She alternated between anxious and fuming. Orders suspended or canceled. Everyone in a panic. With the Euro sliding people are reluctant to purchase her stuff, which is now more expensive for them. She's taking a huge hit. Many other Taiwanese OEM firms and exporters are taking similar hits.

Here are the figures for exports to the EU-15 countries from the Bureau of Foreign Trade.

2010 24,448,492,671
2011 25,601,628,017
2012 23,238,132,050
2013 22,191,676,688
2014 23,506,365,134
2015 21,013,351,866

For comparison, our 2015 exports to China were $71 billion. It's going to be a very tough year economically in Taiwan.

DON'T MISS: The Diplomat: Why Brexit is bad for Taiwan
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1 comment:

an angry taiwanese said...

The Diplomat should learn more advanced English, called relative clause.

Brexit is bad for Taiwan, among those several business people who had used Britain to to export to EU, making quite sufficient money, which will weather them safely through Brexit after effects, which mean these Taiwanese should another way to make a lot of money, that is the biggest and only bad thing that Brexit can inflict upon Taiwan.

I am Taiwanese. Why Brexit is bad for me?