Make Every Effort To Do A Good Job In Foreign Trade And Economic Cooperation

The first quarter of the province's foreign trade and economic situation analysis will be held in Guangzhou.

The main task of the conference is to implement the spirit of the national teleconference on foreign trade work and the deployment of the provincial and provincial governments on the current economic work, in-depth analysis of the import and export situation in the first quarter, and steadily promote the steady growth of foreign trade and economic restructuring.

Vice governor Zhao Yufang attended the meeting and delivered speeches.

Comrades in charge of governments at all levels and above, and in the Shunde district government.

And responsible comrades of the competent departments of the port, the provincial and provincial counterparts in charge of the relevant units attended the meeting.

It is pointed out that the pressure on foreign trade in our province is very large this year. It is facing many new situations and new problems. We must soberly understand the seriousness of the steady growth of foreign trade and never take it lightly.

The reason is to identify the crux of the problem; we should correctly assess the positive factors and favorable conditions for the development of foreign trade, further strengthen our confidence, take the initiative to act as early as possible, and take more targeted measures to counter cycle, expand the market, tap potential and reduce costs, so as to stabilize the growth of foreign trade and economic growth and accelerate the pformation and upgrading.

Zhao Yufang stressed that the more difficult times, the more we need to strengthen the coordination of departments and create a good environment.

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If we solve the problem of capital, will the enterprise develop smoothly? In fact, the sudden growth of capital and the shortage of funds will bring many problems to the management of enterprises.

The influx of large amounts of funds not only means opportunities and hopes for enterprises, but also a severe test. The management mode, operation mode and personal factors of managers will have a great impact on the use of funds, which will affect the efficiency of capital utilization.

Practice has proved that many enterprises are faced with unexpected funds when they are successful in financing. They not only fail to realize the anticipated optimization of resources, but appear many problems, even negative returns.

Money suddenly increased, how to spend it? Without thinking about this problem, enterprises will be faced with the trouble of increasing funds.

The theoretical basis of the above problems can be traced back to the free cash flow hypothesis put forward by Jensen in 1986 in the agency cost of free cash flow, corporate finance and takeover.

The so-called free cash flow, according to the definition of Jensen, refers to the residual cash flow that the enterprise holds after all the net present value is positive.

Because of inconsistent objectives, shareholders and managers have conflicts of interest in the use of free cash flow. Managers have the incentive to hoard and abuse free cash flow, so as to have more controllable resources, obtain more in-service consumption and enhance their rights in the company.

In particular, when the company has a large amount of free cash flow, this phenomenon will become more serious.

Overinvestment often occurs when business managers are over confident and too optimistic about market estimates.

Lang and Lizenberger put forward the "over investment hypothesis" in 1989, that is, some companies will accept some negative investment projects with net present value (NPV) after having large amount of free cash flow.

After the "capital increase", enterprises can not make objective and accurate evaluation of the market, and lack of a reasonable long-term plan, resulting in blind investment and over investment.

A number of enterprises are incomplete, do not understand innovation and pformation, blindly expand the existing capacity, ignore the market supply and demand, resulting in a decline in profit margins.

Especially in some mature industries or declining industries, when the market has already had excess capacity and supply exceeds demand, it will continue to expand production, blindly invest in factories and even buy and merge, which will not only cause market saturation, product assimilation, and yield reduction, but also make the capital chain at the edge of fracture and threaten the survival and development of enterprises.

Such enterprises are not uncommon in household appliances, photovoltaic and other industries.

Others are too eager for innovation and change, blind expansion, and too many other industries that are not related to the main business of the enterprise. As a result, the limited operating resources are too dispersed, causing the core business to be damaged, resulting in dislocation and lack of management, which will adversely affect the long-term development of enterprises.

Take Taizi milk as an example. At the beginning, Taizi milk was a big gun and had been the dominant position of China's fermented lactic acid bacteria beverage industry for many years. However, under the guidance of the goal of "the world's top 500", "enterprise aircraft carrier" and "overseas listing", the enterprise carried out the multi directional and unrelated diversification operation of the big leap forward, involving dairy products, food, children's clothing, daily chemicals, wine making, tourism and leisure, catering, retail, media, real estate and so on.

In the end, the original shareholders lost their stake in Goldman Sachs, Morgan and British Union, and the shares fell.

Capital idle often occurs when business managers are too cautious and lack the courage and courage of investors.

Through the financing of funds, the problem of idle is even more prominent.

There are usually two reasons for the idle funds: one is already raised, and the investment prospect is good, but the market suddenly changes and the situation is uncertain. Therefore, abandoning investment and holding cautiously; the other is that there is no definite plan in the initial stage of financing, nor do we know how to use the fund, because the financing opportunities are better and blindly raise.

There is nothing wrong with the former reason, but the latter reason is worth pondering.

Idle funds are not used for investment. Instead, they deposit money into banks or repay old debts, which is a huge waste of capital.

According to incomplete statistics, about 30% of enterprises' funds are left idle in banks, and because of dividend payments and other reasons, the cost of equity capital is actually higher than that of fixed deposit rates. This means that 30% of enterprises are losing money in doing business. This is probably a situation that all shareholders would not like to see.

In addition, by making up the debt gap by equity capital and helping enterprises tide over the difficulties, this practice can only be applied to the situation that corporate debts will soon expire and that they will not be able to generate enough income when they invest in projects for a time.

Because the rate of return on projects invested by enterprises can often be greater than the cost of debt, the funds used to repay debts will undoubtedly cause enterprises to give up projects that may have higher returns, and miss the right opportunities for development, which will undoubtedly be harmful to the long-term development of enterprises.