RMB Appreciation, Shoe And Garment Industry Lights Up

Benefiting from such factors as the increase in foreign imports, the new opening up of ASEAN, the African market and the improvement of the export tax rebate rate, the export volume of clothing, footwear, bamboo and wood products in Fujian has increased significantly since the beginning of the year, and gradually emerged from the haze of the financial crisis.

Last year, under the background of the international financial crisis, the export of clothing, footwear and other traditional commodities continued to grow.

In 2009, our textile and garment exports increased by US $9 billion 460 million, an increase of 18.6%, shoes exports of US $5 billion 140 million, an increase of 1.6%, and furniture exports of US $1 billion 860 million, an increase of 16.9%.

According to the Fuzhou inspection and Quarantine Bureau survey, this year, Fuzhou footwear, bamboo and wood products and other exports continued to grow.

In the first quarter of this year, the total export volume of footwear products in the region was 13 thousand and 500 batches, with a trade volume of US $336 million, an increase of 37.6% over the same period last year, an increase of 25.7% over the same period, and a total of 6901 batches of bamboo products and 113 million US dollars were exported, representing an increase of 28.82% and 24.23% respectively over the same period last year.

According to the relevant sources of the Bureau, enterprises generally reflected that the order in the first 3 months of this year is obviously more than that of last year, and some have even doubled. Many enterprises are worried not only about the lack of orders, but for the lack of skilled skilled workers and have to give up some orders.

The increase of export volume has brought confidence to enterprises, but the appreciation expectation of RMB exchange rate has made many garment enterprises feel a lot of pressure.

The head of a Fuzhou enterprise said that once the RMB appreciated, the pressure of the enterprises would increase significantly. If the revaluation increased by more than 3%, the foreign orders would be lost.

Earlier, it was reported that the relevant ministries and associations took the lead in the test of RMB exchange rate pressure for labor-intensive industries.

The test results of the import and Export Chamber of machinery, light industry and textiles show that the appreciation of RMB has a great impact on the export profits in the short term. If the appreciation is too fast, the profit rate will drop sharply in the short run, and some industries will suffer losses.

According to the China Textile Import and Export Chamber of Commerce, when the cost and price of other production factors remain unchanged, the RMB appreciation will be reduced by 1%.

"In this case, foreign orders are increasing, but clothing, footwear, bamboo and wood products belong to labor-intensive industries, and export orders are generally low in profits. Some enterprises have to maintain capital or even lose money in order to retain customers.

In some industries, small and medium-sized enterprises are mostly small and medium-sized, and enterprises with large scale are less. On the other hand, the cost of raw materials, labor and other costs has increased sharply, which has greatly reduced the profit margins of enterprises.

The official said that the industry generally bargaining power is weak, it is difficult to negotiate with customers to raise prices to make up for it.

Under the influence of this factor, some orders will not dare to receive because of no money, eventually leading to customer churn.

The experts pointed out that if the production cost is increased, the RMB will continue to appreciate, while the private export enterprises can not find effective ways to reduce production costs, and can not get rid of the predicament that export profits are offset by cost growth. The labor intensive industries in Fujian will face export difficulties.

In this regard, the Fuzhou inspection and Quarantine Bureau suggested that those small and medium enterprises with weak innovation capability should appropriately increase the proportion of raw materials processing, make full use of the advantages of imported raw materials and lower intermediate prices, and weaken the impact of RMB appreciation on enterprise profits.

In addition, enterprises should establish and improve the corresponding quality and safety control system, increase investment in new product development, product technology content enhancement, improve the added value of products, and promote the quality and quality of products.