Foreign Trade Enterprises Are Busy Coping With The High RMB Exchange Rate.

Since its entry into 2010, the advertising film of Hangzhou CIT Rubber Co., Ltd. (hereinafter referred to as "Hangzhou strategy") has appeared in the gold advertisement position of CCTV news broadcast.

Every ten seconds of advertising, this year will spend about 47000000 yuan in Hangzhou's strategy, and they will spend almost 100 million yuan on advertising alone on CCTV this year.

"Our main task this year is to shift the focus of sales to the domestic market and reduce the tires.

The rising trend of the RMB exchange rate, like Damour's sword, is hanging on the neck of China's foreign trade enterprises.

Under the sword

The end of foreign trade enterprises?

"If the renminbi continues to appreciate, I really have to go home and cultivate land."

The boss of a lamp factory in Zhejiang is bullshit.

The lamps and lanterns made by his factory mainly sell to Europe and the United States. They used to live on small profits but quick turnover. Since the RMB to us dollar exchange rate has risen to "7", its profit has been even more modest.

"This exchange rate has increased even more than the financial crisis has hit me."

Bullshit, he made a craft lamp. Now the gross profit is about 1 yuan. If the RMB exchange rate continues to rise, he may lose money himself.

He said he is in a dilemma now that the cost of raw materials and labor is higher and higher, and that the export price does not increase, but he can not earn the money, and the price increase will not be able to get the order.

Lao Hu's feeling may be perceptual. He has not made detailed calculations, but if he really calculates, the result may be even more frightening.

Tian Yeyang, senior manager of Jiangsu Tianheng accounting firm, is busy making IPO (initial public offering) business for two foreign trade enterprises. But after attending a special meeting of the two enterprises, he is not so sure of making these two single businesses.

The export trade of both enterprises accounts for over 50% of the total output value, and their self simulation "pressure test" results show that once the RMB exchange rate reaches 6 or 5.8, the gross profit margin will drop by more than 10%.

"This is a terrible result for foreign trade enterprises."

Tian Yeyang said that last year when the IPO enterprises first met, the SFC was concerned about the extent of the financial crisis. Now, the proportion of the overall foreign trade economy has become the focus of attention, and its core factor is the expectation of RMB exchange rate rise.

Reporters learned that in the face of the high exchange rate of RMB, some enterprises chose to shift their sales focus to Southeast Asia, such as Vietnam, Kampuchea, Laos and other countries.

Enterprise upgrading catalyst?

Not everyone is raising the RMB exchange rate as the doomsday of foreign trade enterprises. Some even think that this is a great opportunity for Chinese foreign trade enterprises to avoid facing the current situation again.

Dr Han Linghui, a Finance Research Institute of the Ministry of finance, believes that the appreciation of the renminbi will have a negative impact on the micro economy, especially on the international competitiveness of the export products based on primary manufacturing, but from a macroeconomic point of view, it will help to enhance the role and flexibility of macroeconomic policies, especially monetary policy.

She believes that at present, there are obvious signs of overcapacity in the domestic primary manufacturing industries, and a moderate appreciation of the RMB will play a greater role in promoting structural adjustment.

Han Linghui's view is evident in some enterprises' response to the high exchange rate.

The Hangzhou strategy is an example.

Jiang Minsheng told reporters that since the financial crisis, Hangzhou's strategy has predicted the major risks that foreign trade will face. It has adjusted the production and marketing structure early, reduced the production scale of low-end products, increased investment in science and technology, and put into production products with high technology content and long-term market prospects.

Adjusting the ratio of domestic sales to export is also a major strategy of Hangzhou's strategy.

"80% of the car tyres we used to export are now exported, and now we are striving to expand the domestic market and strive to adjust the ratio of domestic sales to export to 1: 1."

Jiang Minsheng said that at present, the export share of Hangzhou's main strategy products is controlled within 30%, even if the RMB exchange rate continues to rise, Hangzhou's policy can also withstand.

"In fact, the exchange rate should be divided into two parts. For example, more than 70% of our raw materials come from imports, and the cost of raw materials can be reduced because of the appreciation of the renminbi, thereby counteracting the impact of RMB exchange rate upgrading on enterprises."

Jiang Minsheng said.

Economic restructuring and industrial upgrading are the economic development strategies that have been vigorously promoted by the central government and the local governments in recent years. Under the heavy pressure of RMB exchange rate upgrading, many enterprises have begun to look for new ways like Hangzhou's central policy, and improving the added value of products has become the direction of efforts.

Do not abort in the upgrade.

Economic restructuring and industrial upgrading are inevitable for China's sustained economic development.

But for small and medium-sized foreign trade enterprises that are the main body of China's foreign trade economy, whether they can stick to the "bright prospects" is a more realistic problem.

"Eliminating backward and low-end manufacturing industry is a general trend, but if the RMB exchange rate can not be properly controlled, I think China's foreign trade economy may be greatly hurt."

Tian Ye Yang has been in touch with foreign trade enterprises in Jiangsu for a long time. He is worried about the current living conditions of the enterprises. "As far as I know, the pressure of increasing exchange rate and inflation has made many foreign trade enterprises difficult to survive. Not only a lot of small and medium-sized enterprises are facing bankruptcy, but also a large number of foreign trade enterprises are running at a loss."

"We hope that the relevant departments can attach importance to the current situation of foreign trade enterprises, and do not let them die on the halfway of industrial upgrading."

Tian Yeyang said.

In fact, our country has done a lot of work to maintain exchange rate stability. In 2009, the state reduced the cost of participating in export credit insurance, boosted the export confidence of enterprises, and enhanced the ability of enterprises to resist export risks.

Local governments are also strengthening the anti risk ability of foreign trade enterprises through various means.

Take Jiangsu Province, an intensive foreign trade enterprise as an example. Recently, under the government's push, many foreign trade enterprises are planning to merge and restructure, change the similar situation of the main business, and avoid risks with the advantage of scale.