Both the Korean and Japanese corporations have long expected the revaluation of the RMB (renminbi). Korean experts expect the revaluation and China's adoption of the managed float strategy to help expand the Chinese domestic market, facilitating the entry and development of Korean companies in the country. According to the Korean MOCIE (Ministry of Commerce, Industry and Energy), the revalued RMB will benefit Korean exports headed for the Chinese market, such as PCs, wireless communications devices, as well as cars and automotive key components. However, exports of components and raw materials, such as semiconductors, petroleum products, and steel and iron, may face lower demand due to the lower price competitiveness of finished goods exported from China.

 

Japanese corporate executives, on the other hand, anticipate yet further revaluation of RMB, by approximately 5% to 10% in a year. Surveys conducted by Nihon Kezai Shimbun show that despite the change, most Japanese managers will stick to their previous expansion plans in China. Nonetheless, to diversify risk and seek a more balanced overseas expansion, evaluations are being made to develop alternative markets as well.