In a recent interview with the Financial Times, the CEO of Compal Electronics, Ray Chen, said that the recent appreciation of the renminbi will have negative effects on the company's business in China. As the renminbi appreciates, component and materials suppliers will demand higher prices for their goods, leading to smaller profit margins for the company. Chen stated that if the renminbi would appreciate another 5% besides the recent 2.1%, the company's gross profit margin, which stood at 6% in the first half of 2005, will be cut by 1 percentage point. In recent years Compal and its rivals already have seen profit margin slip to single digits due to fierce competition. Compal is one world's largest makers of notebook PCs, producing approximately 20% of all notebook PCs sold worldwide, and it has concentrated the majority of its production in China.