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Hon Hai's Gou takes more upbeat view of H2's chance of recovery

TAIPEI, Taiwan -- Hon Hai Precision Group Chairman Terry Gou (郭台銘) yesterday struck a more upbeat tone while speaking about Taiwan's economy, saying he is “cautious but optimistic” about the possibility of a recovery in the second half.

Invited to speak at the first meeting of delegates of the Taiwan Strait First Entrepreneurs Summit, Gou, who heads the world's larger electronics contract manufacturing company, said he is never pessimistic about a second-half economic recovery.

“I am cautious — not pessimistic — but optimistic over economic recovery in the second half ... the China and U.S. economies are the most critical.”

In Hon Hai Precision's investor conference in June, Gou used “cautiously optimistic” when giving his outlook for second-half economic status and said he doesn't believe the U.S. recovery to be sustainable, because the Fed's “money-printing scheme” (quantitative easing) has badly damaged the economic well-being of the American middle class, which he said is the fulcrum of U.S. economic growth.

In a public speaking occasion in March, Gou reworded a Chinese Year of Snake saying as “The gold snake leaves the hole in April-May,” a prediction of an economic pick-up. However, he later drew hisses and sell-offs from foreign institutional investors when Hon Hai's financial results turned out to be a big letdown.

Gou, who just returned from a business trip to the U.S. and China, concluded that many negative factors for the world's largest economies are pure financial turbulence, rather than issues of economic fundamentals.

”Money should be put where it's most needed,” Gou said. Financial liquidity induced by world governments including the U.S. and China hasn't yet gone where it's meant to — something we have to be cautious about.”

Regarding government policies, Gou said that Taiwan needs to open up further to foreign investment to accelerate economic growth.

Yesterday's delegate member meeting elected former Vice President Vincent Siew (蕭萬長) as president of Taiwan Strait First Entrepreneurs Summit, and former Strait Exchange Foundation Chairman Pin-kung Chiang (江丙坤) as the summit's vice president.

In other news, Gou revealed Hon Hai's investment and deployment for the future – environmentally friendly painting technology and carbon nanotubes.

Gou said that Hon Hai has developed a green molding process able to emulate the effect of traditional molding techniques meanwhile Hon Hai has successfully developed a cost-effective process technology to produce carbon nanotube for entry-level and mainstream mobile application.

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