Depreciation Of The Euro, Compression Of Profits, Space, Footwear, Daily Necessities, And Market Space

As the largest export market in Quanzhou, the euro's recent "diving" has affected many foreign trade enterprises. Reporters found that most foreign trade enterprises in Quanzhou settled in foreign exchange settlement in the US dollar, but some of them settled in euros and suffered losses. But compared with the direct losses caused by the depreciation of the euro, companies are more worried about the sharp decline in European orders.

　　 Devaluation of the euro Compressed profit space

In May 30th, the central parity of the RMB exchange rate dropped by 266 basis points to 1: 7.8922, breaking the 7.9 pass in one fell swoop. So far, the euro has depreciated more than 4% against the RMB exchange rate since May. This figure, for some export enterprises, means the compression of profit space.

"During the Canton Fair this year, many of our European orders were settled in euros. In April 30th, the euro was still 8.4061 against the central parity of RMB. In May 31st, 1 euros to RMB 7.8351 yuan, in other words, a 100 thousand euro order was now directly lost to 57 thousand yuan. Chen Shitian, assistant secretary of the Fujian chamber of Commerce for luggage and parachute export bases and assistant director of the plum blossom umbrella industry, counted the accounts for the reporters. The goods were still those goods, and the domestic production cost did not drop by one point, but the value of the euro depreciated was nearly 60 thousand yuan.

It is understood that Quanzhou's exports to the EU are mainly textiles. clothing Shoes, hat umbrellas, bags, stones, handicrafts and so on. "At present, more than 90% of textile and garment export enterprises are basically settled through the US dollar, and less than 10% are settled in euros or pounds. Therefore, the direct impact of the depreciation of the euro is not too great for the whole industry." Chen Cangsong, Secretary General of Fujian textile and garment export base, told reporters.

Demand shrinks but customers do not pick up goods.

"Compared with the direct losses caused by the devaluation of the euro, it is more worrying for the enterprises that the purchasing power of the European market is decreasing. European customers lack confidence in the future. They are too small and short to live alone. The European orders, which are included in the recent Canton Fair, are also expected to decrease. " Chen Cangsong said.

"Some customers have made a purchase, but they have not been able to pick up the delivery time. Recently, there has been a rush for several times. The other side said that the market was too depressed, and that it was afraid that the goods could not be sold. This means spanferring the inventory pressure directly to us. Before the whole European market accounted for about 50% of our total exports, this year it may decline to 10% - 20%. Chen Shitian's feelings can also be reflected from the statistics: Quanzhou's exports in the first quarter of this year dropped by 12% throughout the European region, the European Union fell by 13%, and Eastern Europe fell by 43%. According to the latest statistics from Quanzhou entry exit inspection and Quarantine Bureau, from 1 to May this year, the Bureau inspected 21887 batches and 770 million 300 thousand US dollars of export commodities to the EU, mainly from footwear and clothing, and also dropped 10%. From the current situation, the European debt crisis continues to ferment, the industry expects that the market may further shrink, but shoes and clothing as a necessities of life, there is still a certain market space.

Disperse operation, improve product quality and resolve pressure

"At present, there are two ways to hedge against the risk of a euro crash. One is to make long-term forward selling and selling of foreign currency, to lock in the exchange rate in advance, and the other to convert the settlement currency into US dollars and Renminbi. However, although RMB cross-border settlement can be done at present, if our European buyers are unwilling to use it, our export enterprises will not be able to do so. In addition, the US dollar is actually depreciating relative to the renminbi. Therefore, the former is the best choice for enterprises at present. " Bankers say.

"Get rid of over dependence. European market The spanition to emerging markets and domestic markets is also one of the ways to deal with the depreciation of the euro and even the European debt crisis. Emerging markets such as South America are doing well this year, and even the product price is higher than the EU market. " Chen Shitian said. In Lan Zhichun, manager of the administrative department of Quanzhou (light) Co., Ltd., the most fundamental solution is to increase the added value of products to resolve the pressure. He told reporters that more than 50% of the 1000 exhibits exhibited at the Canton Fair were more newly designed products. Most of the designs were from the design team of the company. Although the order growth slowed down, the price of the products increased by about 10%, which could also offset some of the losses.