In the wake of the Ukraine War, the ripple effects are felt far beyond the Eastern European theater. As China and Iran throw their weight behind Russia, the landscape of global commerce undergoes seismic shifts.
From the lens of the supply chain, the clash between democracy and authoritarian regimes intensifies, exacerbating the predicament of Taiwanese enterprises operating in China. Export-oriented Taiwanese factories face a grim reality as they grapple with the inability to penetrate European and American markets, a direct consequence of geopolitical tensions emanating from the Russo-Ukrainian conflict and China's military ambitions vis-à-vis Taiwan.
Thirty years since Taiwanese conglomerates broke ground in the outskirts of China, the erstwhile lucrative real estate investments have morphed into a complex conundrum. The dichotomy between democratic and authoritarian supply chains casts a shadow over the prospects of Chinese-made products abroad, prompting a mass exodus of Taiwanese businesses.
At the heart of the matter lies the dilemma of asset disposition. Despite the astronomical appreciation in land values—exponentially higher than their acquisition costs—Taiwanese firms are confronted with the Herculean task of navigating bureaucratic hurdles and repatriating funds from their Chinese ventures.
As Taiwanese enterprises stage a gradual retreat, the reverberations are keenly felt in Taiwan's domestic real estate market. In response to the evolving landscape, three of Taiwan's four major accounting firms have established dedicated real estate departments, attesting to the burgeoning demand for asset management services amidst geopolitical turmoil.
KPMG Taiwan underscores the structural and intricate shifts characterizing the supply chain relocation saga. Amidst geopolitical uncertainties, asset allocation management assumes paramount significance, prompting industry stalwarts like KPMG to launch specialized real estate consulting arms.
In the crucible of geopolitical flux, Taiwanese businesses find themselves at a crossroads, torn between the allure of the Chinese market and the exigencies of geopolitical realities.
According to the Global Wealth Report 2023, the total global wealth is approximately US$460 trillion. Among non-financial assets, real estate assets account for roughly 53% of the total.
