About 83 percent of the nation’s chief executive officers expect a global recession and diminished consumer confidence due to the COVID-19 pandemic, a survey released by PricewaterhouseCoopers (PwC) Taiwan showed.
The survey conducted from June 1 to 15 found that 59 percent of the respondents believed that COVID-19-related disruptions have exposed corporate inadequacy in risk management, decisionmaking and cross-region coordination, PwC said.
Hence, 48 percent of respondents said that economic uncertainty would be the biggest challenge ahead, followed by worries about protectionism and trade frictions at 42 percent, contagious diseases and other health hazards at 41 percent, and geopolitical conflicts at 37 percent, the survey showed.
However, nearly 60 percent of respondents were confident that their company could return to normal operations within three months of the survey, while 29 percent believed in a recovery within a month, the survey found.
“Taiwanese firms are known for their flexibility, and swiftness to change and adapt. This explains why they have relocated production bases to cope with US-China trade tensions and gain market shares amid the virus crisis,” PwC Taiwan chairman Joseph Chou (周建宏) said on Thursday last week.
About 50 percent of local companies would opt to increase spending on research and development to remain competitive, expand overseas markets and pursue growth opportunities through collaborations with young innovative entrepreneurs, Chou said.
For 56 percent of the respondents, China is the most important foreign market, followed by the US (51 percent), Vietnam (27 percent), Germany (24 percent), Japan (21 percent) and Indonesia (14 percent), the survey showed.
Vietnam overtook Japan and Germany to become the third-most important market for Taiwanese firms due to supply chain realignment, PwC said.
The survey found that 15 percent of CEOs would seek to boost company revenues by cooperating with young entrepreneurs, unfazed by the pandemic.
The US dollar was trading at NT$29.7 at 10am today on the Taipei Foreign Exchange, as the New Taiwan dollar gained NT$1.364 from the previous close last week. The NT dollar continued to rise today, after surging 3.07 percent on Friday. After opening at NT$30.91, the NT dollar gained more than NT$1 in just 15 minutes, briefly passing the NT$30 mark. Before the US Department of the Treasury's semi-annual currency report came out, expectations that the NT dollar would keep rising were already building. The NT dollar on Friday closed at NT$31.064, up by NT$0.953 — a 3.07 percent single-day gain. Today,
‘SHORT TERM’: The local currency would likely remain strong in the near term, driven by anticipated US trade pressure, capital inflows and expectations of a US Fed rate cut The US dollar is expected to fall below NT$30 in the near term, as traders anticipate increased pressure from Washington for Taiwan to allow the New Taiwan dollar to appreciate, Cathay United Bank (國泰世華銀行) chief economist Lin Chi-chao (林啟超) said. Following a sharp drop in the greenback against the NT dollar on Friday, Lin told the Central News Agency that the local currency is likely to remain strong in the short term, driven in part by market psychology surrounding anticipated US policy pressure. On Friday, the US dollar fell NT$0.953, or 3.07 percent, closing at NT$31.064 — its lowest level since Jan.
The Financial Supervisory Commission (FSC) yesterday met with some of the nation’s largest insurance companies as a skyrocketing New Taiwan dollar piles pressure on their hundreds of billions of dollars in US bond investments. The commission has asked some life insurance firms, among the biggest Asian holders of US debt, to discuss how the rapidly strengthening NT dollar has impacted their operations, people familiar with the matter said. The meeting took place as the NT dollar jumped as much as 5 percent yesterday, its biggest intraday gain in more than three decades. The local currency surged as exporters rushed to
PRESSURE EXPECTED: The appreciation of the NT dollar reflected expectations that Washington would press Taiwan to boost its currency against the US dollar, dealers said Taiwan’s export-oriented semiconductor and auto part manufacturers are expecting their margins to be affected by large foreign exchange losses as the New Taiwan dollar continued to appreciate sharply against the US dollar yesterday. Among major semiconductor manufacturers, ASE Technology Holding Co (日月光), the world’s largest integrated circuit (IC) packaging and testing services provider, said that whenever the NT dollar rises NT$1 against the greenback, its gross margin is cut by about 1.5 percent. The NT dollar traded as strong as NT$29.59 per US dollar before trimming gains to close NT$0.919, or 2.96 percent, higher at NT$30.145 yesterday in Taipei trading
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