I disagree with your conclusion, for the following reasons:
a) Taiwan has gained a permanent advantage in bringing electronic products such as IPad, IPhone, PCs, LCD TV, IPods to market far faster than anyone else can do in the world, beating the Japanese, Koreans, West in their process, design and logistics capabilities; and they operate under the radar of any American protectionist tendencies;
b) China is no longer heavily dependent on US for export markets, as its stranglehold on exports to rest of Asia, Africa, Middle East and I guess, even Latam is no longer in dispute;
c) China has forged close ties with SEAsian countries in investing directly in these markets, in property, factories, banks, and infrastructure projects;
d) China has secured one of the most reliable, quality suppliers of raw materials in the world: Australia and NZ, as they can supply both minerals, food, and even energy cost effectively to China. Brazil is almost a cream on the cake at this stage;
e) most importantly, China is growing its domestic market rapidly, retail, property, infrastructure, environment, power, pharma, services, banking, insurance etc etc all at the same time.
China imho is not going to backslide, instead the real momentum has just started and most companies in the Shanghai and Shenzhen exchange (A shares) are still trading at a bargain. I feel it is an opportunity of a lifetime, as you are likely to gain from stock price as well as currency appreciation.
An ETF launched in the US, PEK, a first time play on the A shares closed with a near 15% premium to NAV on first day of trading.
Have you not seen Thailand, Malaysia, Philippines, Indonesia, Singapore are all at new highs, some even all time highs?
2011 will, imho, be the year of China and SEAsia....of course, I am also thinking African markets will provide tough competition, but relative market cap and sophistication is a fraction of the above. |
