Taiwan

Asia Investment Banks (IBs): Overcrowding?

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It seems like Asia may be encountering a few too many IBs around at the moment, (15 altogether – nine bank-backed and six non-bank backed). But which ones are doing really well? Apparently the CIMB group has a lot to say for itself, having been described as “ambitious” in its attempts at becoming a “leading universal bank in South- East Asia, providing a full array of banking services ranging from savings accounts to large corporate transactions for fund-raising.”

Going Global

What initially prompted CIMB to become global occurred in 2005 when it acquired RM500mil of GK Goh Holdings Ltd, which apparently gave the bank access to markets in the region, as well as London. Further to that, the bank purchased the Bumiptura Commerce Bank, Southern Bank, PT Bank Niaga and Bank Thai. Acquiring a “strong balance sheet” led CIMB to greater places.

IB Growth

There has been other regional growth for some of the non-bank IBs too. For example, OSK Investment Bank has established various advancement strategies while working hard on putting itself into the “smaller and mid-cap market as well as research capabilities.” Much of its profit hails from Asia, with 30 percent of its “overseas pre-tax profit” hailing from Singapore. Currently the bank is looking to establish its presence in Thailand and Cambodia. In the former country it is doing this with the purchase of BFIT Securities public Co. and in the latter it now boasts “a full-fledged commercial bank with nine branches as well as license for stockbroking and corporate finance.” OSK IB sees the necessity now to pump up its “institutional equity capability.” If it does this successfully in Hong Kong, it will be well on its way to establishing a very solid presence throughout the Asian region since it sees this country as “one of the largest financial gateways.”

There has been significant restructuring in OSK as well as new employees in an attempt to go further in its markets and develop a presence in Europe while “exposing the Asian markets to the Europeans.” As well the company is looking into what they can do in South Korea, Taiwan and China.

Taiwanese Investment News

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Good news for Taiwanese investors follows the recent announcement from Taiwan’s Ministry of Economic Affairs that Taiwan will be opening up its technical sector (that until now had been extremely closed) to Chinese investment (which will begin slow).  This comes simultaneous to relations between China and Taiwan that are “steadily improving.”  As well, it is in sync with the work Ma Ying-jeou (Taiwan’s President) has been doing to “bolster the island’s economy” with help from the Chinese.  Part of this is buying products from Taiwan.

 

ECFA

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At a recent American Enterprise Institute discussion of Taiwan and the ECFA, Council for Economic Planning and Development Minister Christina Liu said it would be full steam ahead if markets were reaping economic benefits and the ECFA was the right policy.  Things would completely change however, if Taiwan moved toward independence, but this probably wouldn’t be the case as most Taiwanese want to maintain the status quo which might translate to her saying the ECFA wouldn’t be accepted under Taiwanese independence or that China would withdraw benefits in such a situation.


 

Air Transport, Solar and Wind Power News

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 A Japanese airline (a conglomeration of All Nippon Airways and ANA) will begin low cost domestic flights in November and services to China next year.  According to the Civil Aviation Administration of China (CAAC) over 5 million passengers were transported during the Spring Festival through domestic carriers, organizing close to 40,000 flights to meet increased holiday travel demand.  Services will be expanded between Dalian in China’s Liaoning Province and Toyama, Japan to Beijing.  Turkish airlines has grown, as well as Air China, the latter which transported 102,500 tons of mail and cargo.  Hong Kong-based Cathay Pacific Airways – with its subsidiary Dragonair – last month transported 2.24 million passengers, 6.8 percent higher than last year.  China Southern Airlines and China Eastern Airlines likewise reported a significant increase in passenger transportation over the last year.  Spring Airlines will be using AsiaPay’s payment processing solution for its online flight booking, enabling clients to pay for tickets in local currencies.


In terms of airline partnerships, news is that first, China Harbor Engineering Company Ltd (CHEC, a subsidiary of China Communications Construction Company Ltd.) just clinched a US$1.22 billion deal for the construction of a new international airport in Khartoum, Sudan.  Second, China Telecom Corporation Limited has entered into a strategic partnership with Hainan Airlines potentially enabling the latter to be “China’s first air carrier to provide in-flight phone calls and Internet.” New services will be added to Italian airlines too and a Tibet-based air carrier (Tibet Airlines) will be the first air-carrier in the region and will start its operation launching a Lhasa-Beijing service.
 

News from solar power is that China Solar Energy Holdings Ltd. will be acquiring domestic thin-film solar photovoltaic module maker Target Samoa for US$45 million in stock and convertible notes enabling the addition of amorphous silicon thin-film module production.  Taiwanese Neo Solar Power Corp (NSP) said its revenues last month escalated over 150 percent and this trend looks set to improve.  Volthaus GmbH (German solar power developer) is due to receive 20 MWp of solar modules in an agreement with EGing Photovoltaic Technology (Chinese module maker).  There is good news in the solar cell market too in the country, with the use of Maple solar cell technology (broader and flatter silicon cells with fewer grain boundaries).


There is work on potential wind power projects via China Resource New Energy which recently stated it would put US$728 million to US$984 million in wind power developments in pursuit of 150 gigawatts of overall installed capacity by 2020.  A US company CleanTech Innovations informed of its striking a wind tower supply deal from power producer China Guodian.

Substantial Drop in Asian Shares

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Recent world events – New Zealand earthquake, Japan’s credit rating downgrade and continued Middle East and Libyan unrest – led to a significant drop in stock markets across Asia.  For example, South Korea’s Kospi, the Nikkei 225 stock and Hong Kong’s Hang Seng index all plummeted around 2 percent.  As well, Japan had trouble dealing with its huge debt following Moody’s Investors Service downgrading its outlook for the country’s credit rating, citing “increasing uncertainty” over Japan’s capacity to effectively deal with rising debt.  This doesn’t spell good news for the country which only last month had its sovereign debt rating cut by Standard & Poor.  Australia, China, Singapore and Taiwan are currently in the same boat vis-à-vis stock markets. The only good news for the region of late has been the increase in oil prices.

 

TAITRA News

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The upcoming 2011 Renewable Energy Exhibition (Lyon, France), will be privy to the latest green products’ catalogs from Taiwan as well as a demonstration of Taiwantrade.  Taiwantrade is a powerful B2B website, developed by the Taiwan External Trade Development Council (TAITRA) and e-sourcing platform providing clients with tons of information on current trade events, industries news and more. It assists Taiwanese companies with all sorts of developments and is a quality product at a reasonable price.  In terms of its green products, this is not new to a country rated number four in the world of solar modules manufacturing and solar cells.  As well it was rated number 6 in the world for green-energy technology and number two in Asia as an eco-solutions developer.
Also at the exhibition, there will be an attempt to develop cohesion in business with French and European companies while educating on the 50 Taiwanese green suppliers.  TAITRA “will be providing the most comprehensive sourcing services.”
 

Qualcomm to Invest $1 Billion in Taiwan Display Plant

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MirasolTaiwan’s Ministry of Economic affairs announced that Qualcomm, Inc. has decided to invest $1Billion in 2011 to build a plant in Taiwan. The factory will manufacture computer screens using the Mirasol technology. There were very few details given and by Qualcomm’s representative, Mr. Adrian Fu was unavailable for questions.

These displays are excellent for electronic book readers, due to their low power usage. The total market for Marisol type displays is approximately annual sales of $11 Billion, according to Qualcomm Chairman and CEO, Paul Jacobs.

Panamanian President to visit three countries in Asia for investment

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Ricardo MartinelliPanama’s president, Ricardo Martinelli, begin on Friday a tour of Singapore, South Korea and Taiwan to strengthen relations with these countries and attract investment, said the Panamanian Foreign Minister Juan Carlos Varela.

Martinelli will meet with the presidents Sellapan Rama Nathan (Singapore), Lee Myung-Bak (Korea) and Ma Ying-jeou (Taiwan), with whom he seeks bilateral relations on economic issues, according to Carlos Varela.

“The president’s visit (Martinelli) is to bring bilateral relations and encourage foreign investment in the country,” Varela told reporters.

Varela said the tour, which will take 9 days, seeks to promote Panama as “a logistics center and convergence” of passengers and cargo for distribution in the continent.