Ministry Of Industry And Commerce: RMB Appreciation, Textile Machinery And Electricity Industry Has Been Greatly Affected

Zhu Hong, spokesman of China's Ministry of industry and information technology, made the above statement at a press conference in October 28th. He said that the production and operation of export enterprises had been greatly affected.

He quoted the news from the Canton Fair in October, saying that the number of long lists was significantly reduced due to the sharp fluctuations in exchange rates.

As early as April 2010, Zhu Hongren said that exchange rate fluctuations will directly affect four industries, including light industry, textile, electronics and electromechanical industries. The employment of these four industries exceeds 70 million, and exports account for 70% of industrial exports.

In addition to exchange rate fluctuations, another challenge facing mainland enterprises is increased production costs.

Zhu Hongren said that in the first three quarters, the purchase price of raw materials, fuel and power increased by 9.8% over the same period, which was 4.3 percentage points higher than that of the same period.

The cost of employment, land use and financing has also increased to varying degrees.

Moreover, against the backdrop of further slowdown in global economic and trade growth,

Zhu Hongren said that the profitability of Chinese mainland enterprises is weakening.

He said that since the second quarter, the profit growth of Industrial Enterprises above designated size has dropped from month to month, and sales profit margins have dropped from 6.27% in 3 to 6.27% in May to 5.97% in August.