One of the things I have always found fascinating is how macro economic issues can have such widely varying micro economic impacts. By this I mean that when an economy starts tanking, let’s say 10%, the impact on individual businesses can be all over the map.

I remember becoming starkly aware of this during the 1997 Asian Crisis, as I spent a considerable amount of time in Korea that year. The Korean news was doing a story on the drop in imported goods coming into Korea. Now I do not remember the numbers very well, but I think imports had declined about 20%. But the interesting part was how unevenly this fall in imports was among various products. The one that stands out for me is that some fruit (I am 99% sure it was either kumquats or quinces) had gone from $20 million in imports the year before to absolutely zero. Zero. The reason given for this was that it was a luxury and that such luxuries were no longer in demand. Some staple food products had seen virtually no decline.

I have a lawyer friend who represents a huge number of medical practices. He told me of a surgeon client of his whose practice had been decimated when insurance companies reduced their payments and stiffened their reviews. Giving my best guess to the numbers again, he said that surgery rates had declined about 5% across the board in the country, but this doctor’s practice had been hit so hard, his income had gone from something like $450,000 a year to around $50,000. There were various reasons this had happened, but obviously this particular surgeon contributed a lot more than most of the others to the overall 5% decline in surgeon payments.

I mention all this because I have seen very little written about how China’s decline has impacted businesses differently. My firm has seen increased business of late from companies related to energy and fuel savings, food companies, gaming companies, health care companies, education related companies, and, (no surprise here) debt collection companies. All these companies seem to have relatively stable (or even rising) income flows and they are seeking to expand in China or take advantage of China cost savings. Those businesses which seem to have been hit hardest are luxury goods companies, clothing companies, and financial services companies.

Currency fluctuations can also have big impacts. We are seeing increasing numbers of Japanese, Russian and Korean companies looking to purchase US business and real estate assets. The strength of the Japanese Yen has made US assets relatively cheap, while Korean and Russian companies are looking at the US to park money to avoid further declines in their own currencies.

What are you seeing out there?

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Photo of Dan Harris Dan Harris

Dan is a founder of Harris Bricken, an international law firm with lawyers in Los Angeles, Portland, San Francisco, Seattle, China and Spain.

He primarily represents companies doing business in emerging market countries, having spent years building and maintaining a global, professional network. 

Dan is a founder of Harris Bricken, an international law firm with lawyers in Los Angeles, Portland, San Francisco, Seattle, China and Spain.

He primarily represents companies doing business in emerging market countries, having spent years building and maintaining a global, professional network.  His work has been as varied as securing the release of two improperly held helicopters in Papua New Guinea, setting up a legal framework to move slag from Canada to Poland’s interior, overseeing hundreds of litigation and arbitration matters in Korea, helping someone avoid terrorism charges in Japan, and seizing fish product in China to collect on a debt.

He was named as one of only three Washington State Amazing Lawyers in International Law, is AV rated by Martindale-Hubbell Law Directory (its highest rating), is rated 10.0 by AVVO.com (also its highest rating), and is a recognized SuperLawyer.

Dan is a frequent writer and public speaker on doing business in Asia and constantly travels between the United States and Asia. He most commonly speaks on China law issues and is the lead writer of the award winning China Law Blog. Forbes Magazine, Fortune Magazine, the Wall Street Journal, Investors Business Daily, Business Week, The National Law Journal, The Washington Post, The ABA Journal, The Economist, Newsweek, NPR, The New York Times and Inside Counsel have all interviewed Dan regarding various aspects of his international law practice.

Dan is licensed in Washington, Illinois, and Alaska.

In tandem with the international law team at his firm, Dan focuses on setting up/registering companies overseas (via WFOEs, Rep Offices or Joint Ventures), drafting international contracts (NDAs, OEM Agreements, licensing, distribution, etc.), protecting IP (trademarks, trade secrets, copyrights and patents), and overseeing M&A transactions.