Taiwan can outperform Hong Kong, Singapore and Shanghai to become a regional financial hub if the local bourse manages to attract listings from Chinese companies, analysts said yesterday.
“If small and medium-sized Chinese companies can be listed [on the Taiwan Stock Exchange], Taiwan will definitely be attractive to most Chinese-speaking companies and [the bourse] would become the NASDAQ of Asia,” Polaris Securities Co (寶來證券) vice chairman Huang Chi-yuan (黃齊元) told a seminar in Taipei yesterday. “Taiwan is now an undervalued equity.”
Huang said Array Inc (安瑞科技), which was listed on the GRETAI Securities Market on Wednesday, was one of the first Chinese-owned technology companies to test the waters in the local bourse.
Taiwan should also take advantage of its newly won “peace dividends” from growing ties with China and transform itself into a management hub for multinationals, a regional talent incubator and an experimental house for financial innovative capabilities in the region, he added.
Du Ying-tzyong (杜英宗), chairman of Citibank Taiwan’s global investment banking in the Asia-Pacific region, said at the seminar that Taiwan should in the near term consider cooperation with the Shanghai stock exchange on dual listings of public companies, which is “a more feasible” way to strengthen the local capital market.
Du said he was less optimistic about Shanghai’s goal of becoming a regional financial hub by 2020, since China’s society was not open enough and lacked financial transparency and rule of law.
Following a recent rally on the TAIEX weighted index, both Du and Huang yesterday warned that the nation’s economic fundamentals in the second half of the year remained opaque, which could be bad news in terms of the local bourse’s future momentum, despite accelerated cross-strait trade links.
“The recent rally is purely a result of ample liquidity,” Du said. “Without a bolster from solid economic fundamentals, the TAIEX’s prospects in the second half may not be promising.”
Du and Huang agreed that after Morgan Stanley Capital International this week increased its weighting of Taiwanese shares in its equity indexes, a capital inflow of between NT$200 billion (US$6 billion) and NT$600 billion on the local bourse was likely in the near future.
Du urged the domestic banking sector to accelerate its consolidation.
He advised the government to encourage mergers and acquisitions between state-run banks while enticing private financial institutions to assimilate private rivals.
EXTRATERRITORIAL REACH: China extended its legal jurisdiction to ban some dual-use goods of Chinese origin from being sold to the US, even by third countries Beijing has set out to extend its domestic laws across international borders with a ban on selling some goods to the US that applies to companies both inside and outside China. The new export control rules are China’s first attempt to replicate the extraterritorial reach of US and European sanctions by covering Chinese products or goods with Chinese parts in them. In an announcement this week, China declared it is banning the sale of dual-use items to the US military and also the export to the US of materials such as gallium and germanium. Companies and people overseas would be subject to
Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) founder Morris Chang (張忠謀) yesterday said that Intel Corp would find itself in the same predicament as it did four years ago if its board does not come up with a core business strategy. Chang made the remarks in response to reporters’ questions about the ailing US chipmaker, once an archrival of TSMC, during a news conference in Taipei for the launch of the second volume of his autobiography. Intel unexpectedly announced the immediate retirement of former chief executive officer Pat Gelsinger last week, ending his nearly four-year tenure and ending his attempts to revive the
WORLD DOMINATION: TSMC’s lead over second-placed Samsung has grown as the latter faces increased Chinese competition and the end of clients’ product life cycles Taiwan Semiconductor Manufacturing Co (TSMC, 台積電) retained the No. 1 title in the global pure-play wafer foundry business in the third quarter of this year, seeing its market share growing to 64.9 percent to leave South Korea’s Samsung Electronics Co, the No. 2 supplier, further behind, Taipei-based TrendForce Corp (集邦科技) said in a report. TSMC posted US$23.53 billion in sales in the July-September period, up 13.0 percent from a quarter earlier, which boosted its market share to 64.9 percent, up from 62.3 percent in the second quarter, the report issued on Monday last week showed. TSMC benefited from the debut of flagship
TENSE TIMES: Formosa Plastics sees uncertainty surrounding the incoming Trump administration in the US, geopolitical tensions and China’s faltering economy Formosa Plastics Group (台塑集團), Taiwan’s largest industrial conglomerate, yesterday posted overall revenue of NT$118.61 billion (US$3.66 billion) for last month, marking a 7.2 percent rise from October, but a 2.5 percent fall from one year earlier. The group has mixed views about its business outlook for the current quarter and beyond, as uncertainty builds over the US power transition and geopolitical tensions. Formosa Plastics Corp (台灣塑膠), a vertically integrated supplier of plastic resins and petrochemicals, reported a monthly uptick of 15.3 percent in its revenue to NT$18.15 billion, as Typhoon Kong-rey postponed partial shipments slated for October and last month, it said. The
RSS