What Will Be The Major Impact Of The Depreciation Of The Renminbi On China's Footwear Industry?

Today I will not talk about the high cost of China's footwear industry and the low cost topics of Southeast Asian countries such as Vietnam and Kampuchea. It is to make a simple comb on the events that happened on these two days.

1. Vietnam, Kampuchea, Africa and other countries

China's exports to Europe are subject to 15~20% tariffs.

On the afternoon of August 4th, the head of the European Union delegation, Mr. Franz Jessen, was in the news. Release conference Vietnam's footwear products were entered into the EU tax exemption and announced that they had basically concluded negotiations with Vietnam's free trade agreement (FTA). The agreement will take effect from the date of signing, and about 65% of Vietnam's exports to the EU will not be taxable on the first day. Of course, this includes the footwear products that we are very concerned about.

The export of shoes from China to Europe will be subject to 15~20% tariffs. Kampuchea will enjoy tariff free preferences when exporting to Europe. Vietnam's tariffs on European exports may now also be tax-free. African footwear products are also exempt from EU entry.

So, what should the Chinese footwear industry do? Because the tariff of 15~20% and the increasing labor cost will make Chinese export shoe enterprises unable to bear heavy burden.

Whether it is intended or coincidental, the RMB has been devalued for nearly two days in the past 4% days, considering that RMB has appreciated more than 30% over the past 8 years. This is a heavy blow to our manufacturing exports. Even if this happens, the EU countries will give you an anti dumping from time to time, which will make China's export shoe enterprises tremble with fear.

To some extent, the recent devaluation of RMB will undoubtedly make China's export oriented. Shoe enterprises The bosses breathed a sigh of relief.

Wang Yongjun, a shoe doctor, believes that if the RMB continues to depreciate within a controllable range, it will be a great benefit to the Chinese footwear industry, which is currently at a high cost.

　 2., let's see why the renminbi will appreciate.

The fundamental reason is that the pressure from the west is that the developed countries in the West want to force China to launch the currency war against China.

The appreciation of more than 30 over the past eight years means that foreign assets have made so much money in the territory of the renminbi. Once the renminbi continues to appreciate, these assets will probably withdraw from China because of the overvaluation of the renminbi, which will be disastrous for China. Therefore, Tan Yaling, President of the foreign exchange investment research institute, said that we must resolutely resist the RMB breaking 6.

3. what is the advantage of RMB appreciation for the US and other countries?

　 There are three greatest advantages:

1, the assets of the US and other countries in China have risen relative to their currencies, which means that their investment has increased rapidly.

2, China's foreign exchange holdings have depreciated, and these devaluation is just a profit made by the US led countries.

3, we can crack down on China's mouth and China's real economy. A big but not strong China is always what these countries want.

The depreciation of the renminbi at that time is just in time, and at the same time, it is conducive to the transformation of China's economic structure. Industrial upgrading It is good for China to improve people's livelihood and export. This devaluation will bring more investment opportunities to the domestic market and bring more improvement to people's livelihood.

The concrete results are not clear at the moment. Let's wait and see.