People familiar with the matter told reporters that this year China plans to join the International Monetary Fund (IMF)’s RMB Special Drawing Rights (SDR). The final results of the discussions will not be announced until November. The RMB exchange rate is expected to remain stable until the end of the year. . The main senior officials are also very clear about the difficulties encountered by foreign trade.
For most foreign trade companies, the import and export trend in the first half of this year can be described as painful but silent.
On the morning of the 13th, the first half report card released by the General Administration of Customs showed that the overall trend was weak under the environment of sluggish domestic and external demand.
According to customs statistics, in the first half of 2015, my country’s total import and export value was 11.53 trillion yuan, a decrease of 6.9% compared with the same period last year. Among them, exports were 6.57 trillion yuan, an increase of 0.9%; imports were 4.96 trillion yuan, a decrease of 15.5%.
However, Huang Songping, spokesperson of the General Administration of Customs, is still optimistic about the trend in the second half of the year. He said that if there are no major political and economic emergencies in the world, it is expected that the overall situation of my country’s foreign trade import and export in the second half of the year will be better than that in the first half of the year. Among them, exports have rebounded, and in terms of imports, the domestic economy is expected to stabilize and improve. Although it is difficult for international commodity prices to rebound significantly, considering that commodity prices fell significantly in the second half of last year, year-on-year, the decline in import prices will narrow significantly in the second half of this year, and imports will improve.
The RMB exchange rate is expected to remain stable during the year
For foreign trade companies, the most core influencing factor is the RMB exchange rate.
Since the beginning of this year, the euro and yen in developed economies have depreciated significantly against the US dollar. The currencies of Brazil and Russia also depreciated considerably. However, the exchange rate of RMB against the US dollar is relatively stable, which has affected the profit margins of Chinese foreign trade companies.
In the previous weeks of panic in A-shares, foreign trade companies were very concerned about the expected depreciation of the RMB. In the first half of this year, the central bank has cut interest rates four times and cut reserve requirements five times. If the laws of economics are followed, this may trigger currency depreciation. During last Wednesday’s market decline, pressure was triggered to depreciate the RMB. This pressure could not be released in the spot market due to stability maintenance, and was transferred to the long end of the swap, causing the premium of the one-year USD/RMB swap to rise rapidly. The overall liquidity of the RMB is tightening.
However, people familiar with the matter told reporters that this year China plans to join the International Monetary Fund (IMF)’s RMB Special Drawing Rights (SDR), and the final results of the discussions will not be announced until November. The RMB exchange rate is expected to remain stable until the end of the year. The main senior officials are also very clear about the difficulties encountered by foreign trade.
Huang Songping also said that in the customs investigation, the RMB exchange rate is an important factor in increasing the export costs of enterprises. Data from the Bank for International Settlements show that the real effective exchange rate of the renminbi reached a record high in March this year. Since the second quarter, although it has fallen slightly, it is still at a high level. Since the beginning of this year, the RMB has shown an appreciation trend against the euro, US dollar, and Japanese yen. As of June 30, the central parity rate of the RMB exchange rate had appreciated against the US dollar, the euro, and the Japanese yen by 0.2%, 6.9%, and 2.2% respectively compared with the beginning of the year.
It is not easy for exports to maintain growth in the first half of the year when the international economic recovery is weak, external demand is sluggish, the comprehensive cost of exports remains high, and the real effective exchange rate of the RMB continues to be high.
Correspondingly, in the first half of the year, my country’s bilateral trade with the EU and Japan dropped by 6.8% and 10.6% respectively. The import and export of foreign-invested enterprises and state-owned enterprises decreased by 4.8% and 14% respectively. Imports and exports of processing trade fell by 8.6%. The pressure on foreign trade exports will still be high in the next two to three months.
Huang Songping analyzed that the factors behind the trend in the first half of this year include: First, foreign trade demand continues to be sluggish and exports are suppressed. Currently, the global economy is still in a period of deep adjustment after the financial crisis. It is only maintaining low-speed growth. The trends of major economies are divergent. The growth momentum of international trade is insufficient. Some international institutions have also lowered the expected growth rates of the world economy and international trade. Among developed markets, only the United States has relatively good economic growth, while the economies of the Eurozone and Japan are relatively weak. Although emerging markets are growing faster than developed countries, their economic growth has also generally slowed down due to prominent structural contradictions and capital outflows. . Sluggish external demand is the main reason affecting the steady growth of my country’s foreign trade this year.
Second, comprehensive costs remain high and export competitiveness is weakened. At present, my country’s export products, especially labor-intensive products, are still highly sensitive to changes in comprehensive costs. Third, the downward pressure on the domestic economy has increased and import demand has been sluggish. At present, my country’s industrial overcapacity problem is still prominent, which suppresses the demand for imports. Fourth, commodity prices fell sharply, which lowered the growth rate of import value.
Foreign trade looks forward to the second half
According to general rules, China’s foreign trade will gradually usher in export climaxes including summer back-to-school, Thanksgiving, and Christmas in the second half of the year. Therefore, the second half of the year tends to be better than the first half.
Regarding the main external environment in the second half of the year, Huang Songping believes that Greek debt should still have a certain impact on my country’s import and export, and the General Administration of Customs will pay close attention.
In terms of the internal environment, Zhou Shijian, a senior researcher at the Center for Sino-US Relations at Tsinghua University, believes that in the second half of the year, the��With the implementation of a series of large investment projects approved by the state, economic growth will gradually stabilize and will also drive the growth of imports.
Huang Songping said that since the beginning of this year, the country has continued to increase its efforts to streamline administration and delegate powers. On the basis of further implementing the policies and measures that have been introduced to stabilize the growth of foreign trade and expand imports, we have successively launched the “One Belt, One Road” strategy, listed three new free trade pilot zones, and introduced policies to accelerate the cultivation of new advantages in foreign trade competition, Made in China In 2025, a number of more targeted major reform measures will be implemented, such as promoting international production capacity and equipment manufacturing cooperation, promoting the rapid and healthy development of cross-border e-commerce, and also encouraging mass entrepreneurship and innovation to promote the development and upgrading of the open economy. These will become The biggest policy dividend for my country’s foreign trade development in the future will further stimulate the vitality of enterprises.
At present, policy measures have initially appeared, especially since the second quarter, import and export have shown a steady and positive trend. Judging from the trends in the first and second quarters of this year, imports fell by 13.8% in the second quarter, 3.5 percentage points narrower than the decline in the first quarter. Although exports in the second quarter changed from a growth of 4.9% in the first quarter to a decrease of 2.5%, the export trend in each month of the second quarter showed signs of improvement month by month. Among them, exports fell by 6.2% and 3.2% respectively in April and May, and the decline narrowed. By June, it had returned to positive growth of 2.1%.
But some companies are still shrouded in pessimism. Yang Xiaochuan, deputy manager of the sales company of Guangdong Zhongcheng Chemical Co., Ltd. of Liuhua Group, believes that it would be good if the second half of the year can be the same as the first half. The annual decline will be roughly 10% to 15%. Because the domestic and foreign demand for products is weakening, from an overall perspective, the competitiveness of China’s exports is declining, and its global share will naturally decrease. In addition to the exchange rate, the rigid increase in labor costs is also an important factor in this decline in competitiveness.
“The labor force in Myanmar is working hard to increase the minimum wage from US$4 per day to US$5 per day. What about the wages in China’s coastal areas? If the monthly income of workers in our factory is less than 6,000 yuan, it will be a big problem!” he said.
China’s foreign trade half test: exchange rate remains stable in the second half
People familiar with the matter told reporters that this year China plans to join the International Monetary Fund (IMF)’s RMB Special Drawing Rights (SDR). The final results of the discussions will not be annou…
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