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, nor are they ready for the risk of carbon import duties on their products. Various sectors, including airlines, cement and steel firms, computer manufacturers, and shipping companies, could be affected based on their profit margins, ability to pass on costs, and exposure to the US and Europe. The analyst believes that a major climate conference in Denmark in December could lead to a broader implementation of carbon pricing in Asia, with a carbon tax or emissions trading potentially affecting numerous companies across all Asian markets within three years. The analyst 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 are not prioritizing climate change. Smiles, the author of a major UBS report titled "How could carbon pricing impact Asian company earnings?", recently published his findings. He examined three scenarios: domestic carbon pricing in Asian countries, "equalising" carbon import duties between richer and poorer nations, and harsher climate change carbon import duties. He stated that the second option is the most likely in the medium term, citing signals from the United States and the European Union regarding potential duties on goods from countries without greenhouse gas caps. The Waxman-Markey climate bill, which has yet to be voted on in Congress, includes a proposal for an international reserve allowance programme. This scenario would require American companies to purchase energy-intensive products from countries that do not share the same emissions goals as the United States. In order to offset the carbon emissions associated with these foreign goods, US companies would need to purchase allowances. According to Smiles, industries such as marine transport, airlines, steel production, and technology companies would be impacted by this second scenario, as exporters would be responsible for paying for the carbon emissions they produce. However, domestic companies would not be affected. Smiles also mentioned that once the US implements carbon pricing, more than half of global private consumption will be subject to carbon pricing. The report suggests that Asian airlines such as Taiwan's Eva Airways, Thailand's Siam City Cement, and South Korean Hyundai Merchant Marine would be significantly affected by potential carbon-related import duties. The study projected that Eva Airways' earnings per share could drop by 34.3 percent, Siam City Cement's by 10.6 percent, and Hyundai Merchant Marine's by 51.4 percent based on 2010 earnings projections and a carbon price of US$9 per tonne. The most affected industries would be airlines, power utilities, marine transport, and cement makers if domestically focused firms and exporters were required to pay for the CO2 they emit. The study assumed that Asian countries would implement domestic carbon taxes or carbon trading schemes aiming for a 20 percent reduction in CO2 emissions. China Airlines is expected to experience a significant decrease in its 2010 EPS due to its high exposure to the United States and EU, a 30 percent fuel cost exposure, and a slightly negative earnings margin. On the other hand, Singapore Airlines' EPS is projected to only decline by 8.6 percent, attributed to its 9.5 percent net profit margin and slightly lower fuel cost exposure. The possibility of exporters being held accountable for the CO2 emissions of their home countries seems less likely currently. This scenario was seen as a way to pressure countries like China and India to participate in global efforts to combat climate change. The report examines the potential costs of implementing a domestic carbon pricing regime in these countries. It was believed at that time that the US and Europe placed a uniform tax on all manufactured exports from each country, resulting in the assumption that the total cost for every country was borne by these two regions. In 2007, China's estimated carbon cost was $55 billion, and India's was $9 billion.