A senior UBS analyst in Singapore stated that many Asian companies are not fully aware of the potential financial impacts of carbon pricing in the region, as well as the risk of facing carbon import duties on their products. Sectors such as airlines, cement, steel, computer manufacturers, and shipping companies could be affected based on their profit margins, ability to pass on costs, and exposure to the United States and Europe. The analyst mentioned that a significant climate conference in Denmark in December could lead to broader implementation of carbon pricing in Asia, with a carbon tax or emissions trading affecting numerous companies across the region within three years. He also noted that investors in Asia tend to overlook this issue due to their short-term focus and belief that governments in India and China do not prioritize climate change. Author Smiles recently published a major UBS report titled "How could carbon pricing impact Asian company earnings?" in which he examined three scenarios: domestic carbon pricing in Asian countries; "equalizing" carbon import duties between richer and poorer nations; and harsher climate change carbon import duties. He suggested that the second scenario was the most probable in the near future, citing hints from the United States and the European Union regarding potential duties on products from countries without greenhouse gas regulations. The Waxman-Markey climate bill, which has not yet been voted on in Congress, includes a proposal for an international reserve allowance program. This scenario would require American companies to purchase energy-intensive products from countries that do not have the same emissions goals as the United States. These US companies would need to purchase allowances to compensate for the carbon emissions associated with foreign goods like cement or steel. According to Smiles, under this second scenario, marine transport companies, airlines, steel manufacturers, and tech firms would be impacted as exporters would be responsible for paying for the carbon emissions based on the CO2 they release, while domestic companies would not. As carbon pricing is implemented in the US, more than half of global private consumption will be subject to carbon pricing. They would be in a better position to potentially implement import duties related to carbon, according to the report. Taiwan's Eva Airways would experience the largest impact among Asian airlines, with a 34.3 percent decrease in earnings per share based on 2010 projections and a carbon price of US$9 per tonne. Siam City Cement in Thailand would see a 10.6 percent decrease in EPS, while Hyundai Merchant Marine in South Korea would experience a 51.4 percent drop. The most affected industries under the first scenario, where companies pay for their CO2 emissions, include airlines, power utilities, marine transport, and cement makers. The study assumed that Asian countries would implement domestic carbon taxes or trading schemes aiming for a 20 percent reduction in CO2 emissions. China Airlines is expected to experience a significant drop in its 2010 EPS due to its high exposure to the United States and EU, as well as a 30 percent fuel cost exposure and slightly negative earnings margin. On the other hand, Singapore Airlines' EPS is projected to decrease by only 8.6 percent, attributed to its 9.5 percent net profit margin and slightly lower fuel cost exposure. The report suggests that the third scenario, in which exporters of manufactured goods would bear the cost of the CO2 emissions of their home countries, seems less likely at the moment. This scenario was aimed at pressuring countries like China and India to join global efforts in combating climate change. Smiles mentioned that the report examines the potential costs of implementing a domestic carbon pricing regime in these countries. It was believed that the US and Europe placed a uniform tax on all manufactured exports from various countries, resulting in China facing a carbon cost of $55 billion and India facing a cost of $9 billion in 2007.