Recently, the RMB has depreciated. As of April 24, the exchange rate of the US dollar against the RMB has fallen to 6.1589. According to industry analysts, this round of continued depreciation of the RMB has a significant stimulating effect on the export volume of labor-intensive enterprises such as textile fabrics, which are not very profitable.
According to reports from many foreign trade companies engaged in the textile fabrics industry, previously restricted by the foreign trade environment and cost pressure, business operations were very difficult and even reached the edge of bankruptcy. The continued depreciation of the RMB this time has given companies some breathing room. Calculated based on European and American orders, the continued depreciation of the RMB will bring 1% to 2% profit to the company.
In addition, some fabric companies said that although the depreciation of the RMB did not immediately bring about a significant increase in export orders, it still relatively eased the pressure on fabric export costs. This is good news for the company and buffers it to a certain extent. Operational pressure brought about by rising labor and other cost issues.
Recently, many foreign trade companies have felt the export dividends brought by the fluctuation of the RMB exchange rate. “In the past, the RMB has maintained a long-term appreciation trend, and the cost pressure for product exports was very high. Companies could only make profits by raising prices by about 15% to 20%. Now, the RMB has depreciated, and the quotation space for export orders is more flexible. We will get more orders and our profits will also increase a lot.” Mr. Li, who is engaged in fabric export in Keqiao Textile City, said that the continuous decline of the RMB exchange rate against the US dollar is a big problem for people like him who run small foreign trade companies. It is undoubtedly exciting news, “Recently, everyone’s confidence in doing foreign trade among friends has increased again. In the past two months, the monthly export business income has been tens of thousands of yuan more than last year. ”
However, some industry experts said that the dividend effect brought about by the devaluation of the RMB cannot help solve the actual difficulties encountered by fabric export companies.
At present, the export methods of domestic fabric companies are still too traditional, and the model of relying on processing trade has not changed. In addition, the rising costs of labor, logistics, financing and other aspects have made many companies not very competitive and their profits continue to decline. Fluctuations in exchange rates have little real impact on the long-term development of enterprises. If an enterprise wants to truly become bigger and stronger, it should improve efficiency from aspects such as management, innovation, and branding. Only in this way can the core competitiveness of the enterprise be increased and the profit margin of the product improved.
