Analysis Of How RMB Appreciation Affects Foreign Trade Shoes And Clothing Export

"The biggest and most direct impact of RMB appreciation is the reduction of profits by export enterprises." City commerce bureau Party Secretary Liu Suyue said. According to Changsha customs statistics, Changsha's total exports amounted to US $3 billion 360 million in 1-10 this year. According to the magnitude of the RMB appreciation of 4.6% this year, the impact of Changsha's export enterprises on earnings reduction is nearly 1 billion 100 million yuan (excluding the time of settlement). During the same period last year, the appreciation rate of RMB was only 2.65%, and the impact on Changsha's export enterprises was only 400 million yuan.

Among many export enterprises, shoes and clothing enterprises with low value added export have been hit most. According to the data provided by the Municipal Bureau of Commerce, the proportion of traditional labor intensive products exports in Changsha's foreign trade enterprises is more than 40%. These small and medium-sized enterprises, which rely on low price competition and small profit margins, are facing the grim situation of losing money or even failing because of the appreciation of the renminbi.

"Because of the appreciation of the renminbi, it only evaporated 10 thousand dollars in just 10 days." Li Qiang, who has been engaged in shoes trade for many years, told reporters that not long ago, he completed an order of 100 thousand dollars, and it was 10 days late for negotiation with the bank at the request of Japanese clients. The result was that the depreciation of the US dollar was lost by US $10 thousand. "Our exported sports shoes are priced at 5 US dollars, left and right, and the profits are only 1% to 2%, which basically do not make money, and some orders even lose money." But even so, he, like many foreign trade enterprises, would rather sacrifice his interests and keep the market.

Had to reluctantly give up long Dan Dadan

"The original offer to European and American businessmen is adjusted once every three months, and now it has to be changed on a Monday." But even so, it is difficult to avoid the risk of cost factors. A large number of Japanese merchants gathered in China before and after the lunar new year. Last year, he had tens of thousands of orders in the new year. Because of the increase in labor and raw material costs, the factory suddenly asked for an increase in price. Before and after ten or twenty days, it lost tens of thousands of yuan.

According to the latest survey report of the 110th Canton Fair by the Municipal Bureau of Commerce, the number of exhibitors in hand recently was basically the same as that of the previous session, which accounted for 35% of the increase in the same period last year, 40% of the fair share, and 25% of the enterprises. In the declining enterprises, SMEs accounted for more than 90%. Most of the orders for traditional products such as textiles, clothing and shoes are in the first quarter of next year. Due to fluctuations in the RMB exchange rate, domestic raw material prices, labor costs and other factors, many enterprises can only shorten the quotation time to receive a short list. According to the survey report, the orders for the exhibitors were 55% less than 3 months, and only 10% for the 6 months or more.

In the face of increasingly compressed profit margins and sluggish international markets, many foreign trade enterprises are also making constant efforts to innovate. "With the appreciation of the renminbi and the increase in labor and raw material costs, the road of labor-intensive enterprises with low added value will become narrower." Li Qiang, who studied foreign trade, clearly saw this. This year, Li Qiang handled business visas, from one or two to three or four times a year, "according to customer requirements, we need to strengthen new product development, do service to the door and do things in place. When customers have orders, they will naturally think of you."