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Depreciation of the euro fear will lead to significantly reduced orders for Chinese furniture enterprises
At present, nearly one trillion U.S. dollars in assistance programs, although the European sovereign debt temporarily curb the rapid spread of the crisis, but the euro’s rebound in the market is still skeptical. If this trend continues, the euro will have a profound impact on the global economy, which "bring disaster to the" China’s furniture industry exports to the EU market.
The depreciation of the euro countries (see map) with the impact of industry
1, the euro was flat the long run the dollar will help enhance the competitiveness of the European Union
In a series of rescue measures to stimulate Europe, the euro rebounded against the U.S. dollar trend, however, has insufficient capacity for the euro is down, May 27, the euro exchange rate against the yuan central parity of 8.3940 reported. Only six months time, the euro broke the way "10", broken "9", a great break "8" trend. June 1, late New York trading the euro against the U.S. dollar to close at the 1.2253, down slightly from the previous trading day; However, the intraday euro fell to 1.2111 against the dollar once again to refresh the lowest in four years.
No more than half of the year 2010, the euro rate of nearly 20% depreciation of the dollar, only to fall 7% in May, the euro has hit the longest in 11 years the birth of a slump. EU member states against the euro did not panic, the opposite is very optimistic. BNP Paribas’s chief Asia economist Richardlley that the European banking industry is now sounding the orange alert, the situation is really worse if the banking sector, then the best current economic development in Asia will also be affected. He expects the euro-dollar exchange rate will reach 1:1 in the first half of the level of the dollar and the euro will be equal. French Prime Minister Francois Fillon said that the euro is overvalued against the dollar has affected the exports of the euro area, seriously damaging the interests of the eurozone, the euro exchange rate remained low is good news. EU Ambassador to China Serge? Abou said: At present, we are not worried about the status of the euro, we are only worried about the speed of the depreciation of the euro, but now appears to have stabilized the euro, the euro exchange rate close to Its historical average and in line with the euro area economy the basic situation, this level is a reasonable reflection of the competitiveness of the euro, further depreciation will enhance their competitiveness.
This shows that moderate depreciation of the euro in the euro area not only save the consumer market, but also business investment in the euro area, further reducing operating costs. In the June 7 European trading hours, European stocks and the euro exchange rate both stabilize the German Ministry of Economic Affairs released figures on the 7th, due to growing domestic demand, Germany’s manufacturing orders in April rose 2.8%, Central, up increase 29.7%, higher than market expectations. Manufacturing orders in Germany in April data from the euro area member states and 15 orders less than 1% in March, orders from countries outside the euro zone growth of 5.5%. Analysts said the continued depreciation of the euro as German manufacturers maintain the growth momentum of the "hero", the EU appears to have acquiesced euro to support the economy and to help member countries out of debt trap, is expected to Xia Bannian will gradually pick up the EU market, the global economic situation, will gradually be optimistic.
Second, China’s furniture exporters in response to home and less abroad to maximize profit
It is understood that China’s exports to the EU mainly include mechanical and electrical products, electronic products, textiles, clothing, footwear, furniture, machinery and electronic products which accounted for about half of export sales. Depreciation of the euro, will be on the exports of a certain impact on the short term, so that exports become more "expensive" and greatly reduce the price competitiveness of Chinese products, a number of SMEs in order to get the EU is a heavy blow. U.S. dollar devaluation in 2008, when the furniture export business began to try to use euros. Originally settled in euros is to reduce risk, reduce losses, but on Jan. 1, 2010, �100,000 convertible 979,700 yuan, as of May 27 only exchange 839,400 yuan, 100,000 euros loss of 140.3 thousand yuan Renminbi, the exchange differences for many enterprises that the economic damage. As the renminbi is virtually pegged to the dollar, resulting in a passive appreciation of the yuan, no doubt, the euro and the yuan revaluation of China’s import and export business in the second half. Economic experts say: the impact of the euro is lagging behind, on the impact of Chinese exports to the EU companies being slow, but sooner or later to come. In the second half of the EU export growth will slow down. If the euro continues to remain strong, while inflation, the National Wujin purse, low consumption, long-term export situation can not be reversed, China’s economic growth may slow down.
At the same time, domestic furniture production costs continue to increase. Since the beginning of this year, the prevalence of the "labor shortage" due to the failure to increase labor costs, raw materials prices have also continued to rise, particularly sheet, sponge, paint, hardware and accessories rose significantly. Shortage of timber and other raw materials, according to statistics, China’s total timber imports in the first quarter, a significant increase in imports reached a total of 7.7 million cubic meters, the total amount of more than 130 million U.S. dollars, compared to last year in the number and total amount, respectively, an increase of 37% and 60%. But the domestic demand for timber increased to maintain the trend will not last long, half timber imports is expected to be down. Coupled with a revaluation of the renminbi expected, the cumulative appreciation of the euro has reached 14.5% in the long run will also give our exporters a huge cost pressure, these factors will result in furniture prices in the second half.
Ningbo Furniture Association Secretary-General Yang Junyuan also said: "The increase in raw materials and labor costs, furniture prices is inevitable, from the general trend this year, or expected to be 10% -15%." But this time the Chinese furniture industry has experienced the euro, into a furniture export business dilemma situation, the EU market, weak demand, furniture exporters are forced to adjust prices, but in the country is facing pressure to increase the cost of furniture products, furniture enterprises have no price reduction profitable phenomenon, "China" less and less the price advantage of its market competitiveness, this External and internal situation, if continues, will lead the Chinese furniture industry structural reorganization. Therefore, only by continuously adjusting the furniture industry’s export trade policy, reduce product cost in order to adapt to the changing international market.
However, while the euro suffered, but the EU remains China’s largest export market. Ministry of Commerce spokesman Yao insisted that Europe’s overall economy will be dragged down the debt crisis of Greece, the EU’s economic growth this year is only about 1% -1.5%. European Union as China’s largest export market, accounting for 16% of the scale of trade and European debt crisis will affect the whole of China’s exports. Statistics: 2010, 4 months, China-EU bilateral trade value 137.77 billion U.S. dollars, up 34.6%. Sino-US trade over the same period was 107.18 billion U.S. dollars worth, up 25%. By statistics in 25 countries or regions, the EU export growth ranked 19th, but did not shake the European Union as China’s leading export market.
It is learned from the view of the first quarter of this year, Zhejiang province’s furniture exports grew 12.58%; Guangdong exported 3.73 billion U.S. dollars of furniture and parts thereof, up 27%, of which, Dongguan furniture exports grew 29.63%; Jiangsu Province, Kunshan, a city of single- Furniture exports accounted for half the province’s furniture exports, up 37.6%. Chinese furniture exports to the EU as a whole still shows a growing trend. Many of the furniture industry exports to the EU said that if the euro continues to weaken, then the second half of the orders from the European Union market, not only may be much reduced, and export growth will also slow down the EU. On the other hand, continued depreciation of the euro there will be exporters of furniture exports to the EU increased settlement costs, product prices less competitive, in the second half to reduce the plight of the total exports, but this is only temporary. EU economy, politics, senior experts generally optimistic about the euro, the euro enhance the competitiveness of the EU market will gradually recover. So hard to predict: the end of this year and early next year, import and export trade between China and the EU will gradually rise.
My academic economist’s view on the euro depreciation varies, the modest appreciation of the RMB controllability generally more optimistic. Chinese Academy of Social Sciences Institute of World Economics and Politics Song Hong International Trade Research Office, said: The European impact of the debt crisis has not reached the level of the real economy. It is different with the financial crisis, financial crisis is the primary cause of decline, now that the debt crisis is to stimulate economic growth in the course of the problems of the impact is much smaller, even if the impact on the real economy, it also takes a very long time. Overall, the RMB appreciation will first affect China’s exports, however, modest appreciation is not unbearable. Hai Tong Securities chief analyst Chen Lu macroeconomic view, the status of the export enterprises may be the biggest problem is the shortage of labor ("labor shortage"), triggered by rising costs and shortage of capacity utilization, rather than worry about the order before the issue of the RMB modest rise slightly, probably more of a benefit. Therefore, China furniture export companies to hold its ground, positive euro bailout to survive the temporary difficulties caused.
Third, actively respond to the euro cooperation and win-win tomorrow
Depreciation of the euro, spread to many countries trade with the EU, companies how to trade in the currency depreciation due to minimize economic losses, this is the furniture export enterprises are most concerned about. Natural depreciation of the euro as the EU market, the market demand for auto-reduction, designed to avoid risk, reduce economic loss of profits, in order to survive temporary economic difficulties. Meanwhile, volatility in the global market economy, the occasion, the furniture industry not to "put their eggs in one basket", should be divided into enterprise risk sections in the different markets in order to achieve the face of financial turmoil and safe. Economic recession, the export enterprises should actively try to expand in North America, Middle East and other emerging international markets, the risk of development of the crisis into an opportunity.
As a result, foreign trade experts advise: Since there is still no European sovereign debt crises are signs of improvement, the euro market, prospects for recovery is not clear, the euro will break "8", or how long the euro would also be very difficult to judge, not the face of the current unforeseeable circumstances, the exporters in the Eurozone market enterprises signed contracts should be as flexible and go "quick" route to short-term contracts mainly small, can use the U.S. dollar clearing, appropriate reduction in the euro entered into non-dollar currencies such as clearing contract . Business-to-export business, especially the U.S. dollar clearing business, may enter into with banks handling foreign exchange business forward, that production costs under the company’s payment of the exchange rate lock customers in the exchange rate changes, the company hardest hit is not too much.
Export enterprises to make better use of various financial products to avoid the risk of exchange rate differences, in order to ensure that enterprises have a higher value of export. If the euro continues to weaken, to avoid risks to reduce economic losses, may reduce the EU market based on market orders, price leverage to adjust, but in this case the price cuts, corporate profits little, the state can introduce relevant policies, such as export tax rebates, the price subsidies to help the EU market recovery, encouraging domestic enterprises to actively integrate into the rescue, riding out the storm together. If the continued depreciation of the euro will result in continued deterioration of the European Economic Area, will inevitably spread to other international trade area already are signs of recovery in the EU import and export business may suffer damage. Therefore, economic globalization and integration of today, we should be hand in hand, side by side, the EU implementation of international assistance, cooperation and win-win future! ,
The depreciation of the euro countries (see map) with the impact of industry
1, the euro was flat the long run the dollar will help enhance the competitiveness of the European Union
In a series of rescue measures to stimulate Europe, the euro rebounded against the U.S. dollar trend, however, has insufficient capacity for the euro is down, May 27, the euro exchange rate against the yuan central parity of 8.3940 reported. Only six months time, the euro broke the way "10", broken "9", a great break "8" trend. June 1, late New York trading the euro against the U.S. dollar to close at the 1.2253, down slightly from the previous trading day; However, the intraday euro fell to 1.2111 against the dollar once again to refresh the lowest in four years.
No more than half of the year 2010, the euro rate of nearly 20% depreciation of the dollar, only to fall 7% in May, the euro has hit the longest in 11 years the birth of a slump. EU member states against the euro did not panic, the opposite is very optimistic. BNP Paribas’s chief Asia economist Richardlley that the European banking industry is now sounding the orange alert, the situation is really worse if the banking sector, then the best current economic development in Asia will also be affected. He expects the euro-dollar exchange rate will reach 1:1 in the first half of the level of the dollar and the euro will be equal. French Prime Minister Francois Fillon said that the euro is overvalued against the dollar has affected the exports of the euro area, seriously damaging the interests of the eurozone, the euro exchange rate remained low is good news. EU Ambassador to China Serge? Abou said: At present, we are not worried about the status of the euro, we are only worried about the speed of the depreciation of the euro, but now appears to have stabilized the euro, the euro exchange rate close to Its historical average and in line with the euro area economy the basic situation, this level is a reasonable reflection of the competitiveness of the euro, further depreciation will enhance their competitiveness.
This shows that moderate depreciation of the euro in the euro area not only save the consumer market, but also business investment in the euro area, further reducing operating costs. In the June 7 European trading hours, European stocks and the euro exchange rate both stabilize the German Ministry of Economic Affairs released figures on the 7th, due to growing domestic demand, Germany’s manufacturing orders in April rose 2.8%, Central, up increase 29.7%, higher than market expectations. Manufacturing orders in Germany in April data from the euro area member states and 15 orders less than 1% in March, orders from countries outside the euro zone growth of 5.5%. Analysts said the continued depreciation of the euro as German manufacturers maintain the growth momentum of the "hero", the EU appears to have acquiesced euro to support the economy and to help member countries out of debt trap, is expected to Xia Bannian will gradually pick up the EU market, the global economic situation, will gradually be optimistic.
Second, China’s furniture exporters in response to home and less abroad to maximize profit
It is understood that China’s exports to the EU mainly include mechanical and electrical products, electronic products, textiles, clothing, footwear, furniture, machinery and electronic products which accounted for about half of export sales. Depreciation of the euro, will be on the exports of a certain impact on the short term, so that exports become more "expensive" and greatly reduce the price competitiveness of Chinese products, a number of SMEs in order to get the EU is a heavy blow. U.S. dollar devaluation in 2008, when the furniture export business began to try to use euros. Originally settled in euros is to reduce risk, reduce losses, but on Jan. 1, 2010, �100,000 convertible 979,700 yuan, as of May 27 only exchange 839,400 yuan, 100,000 euros loss of 140.3 thousand yuan Renminbi, the exchange differences for many enterprises that the economic damage. As the renminbi is virtually pegged to the dollar, resulting in a passive appreciation of the yuan, no doubt, the euro and the yuan revaluation of China’s import and export business in the second half. Economic experts say: the impact of the euro is lagging behind, on the impact of Chinese exports to the EU companies being slow, but sooner or later to come. In the second half of the EU export growth will slow down. If the euro continues to remain strong, while inflation, the National Wujin purse, low consumption, long-term export situation can not be reversed, China’s economic growth may slow down.
At the same time, domestic furniture production costs continue to increase. Since the beginning of this year, the prevalence of the "labor shortage" due to the failure to increase labor costs, raw materials prices have also continued to rise, particularly sheet, sponge, paint, hardware and accessories rose significantly. Shortage of timber and other raw materials, according to statistics, China’s total timber imports in the first quarter, a significant increase in imports reached a total of 7.7 million cubic meters, the total amount of more than 130 million U.S. dollars, compared to last year in the number and total amount, respectively, an increase of 37% and 60%. But the domestic demand for timber increased to maintain the trend will not last long, half timber imports is expected to be down. Coupled with a revaluation of the renminbi expected, the cumulative appreciation of the euro has reached 14.5% in the long run will also give our exporters a huge cost pressure, these factors will result in furniture prices in the second half.
Ningbo Furniture Association Secretary-General Yang Junyuan also said: "The increase in raw materials and labor costs, furniture prices is inevitable, from the general trend this year, or expected to be 10% -15%." But this time the Chinese furniture industry has experienced the euro, into a furniture export business dilemma situation, the EU market, weak demand, furniture exporters are forced to adjust prices, but in the country is facing pressure to increase the cost of furniture products, furniture enterprises have no price reduction profitable phenomenon, "China" less and less the price advantage of its market competitiveness, this External and internal situation, if continues, will lead the Chinese furniture industry structural reorganization. Therefore, only by continuously adjusting the furniture industry’s export trade policy, reduce product cost in order to adapt to the changing international market.
However, while the euro suffered, but the EU remains China’s largest export market. Ministry of Commerce spokesman Yao insisted that Europe’s overall economy will be dragged down the debt crisis of Greece, the EU’s economic growth this year is only about 1% -1.5%. European Union as China’s largest export market, accounting for 16% of the scale of trade and European debt crisis will affect the whole of China’s exports. Statistics: 2010, 4 months, China-EU bilateral trade value 137.77 billion U.S. dollars, up 34.6%. Sino-US trade over the same period was 107.18 billion U.S. dollars worth, up 25%. By statistics in 25 countries or regions, the EU export growth ranked 19th, but did not shake the European Union as China’s leading export market.
It is learned from the view of the first quarter of this year, Zhejiang province’s furniture exports grew 12.58%; Guangdong exported 3.73 billion U.S. dollars of furniture and parts thereof, up 27%, of which, Dongguan furniture exports grew 29.63%; Jiangsu Province, Kunshan, a city of single- Furniture exports accounted for half the province’s furniture exports, up 37.6%. Chinese furniture exports to the EU as a whole still shows a growing trend. Many of the furniture industry exports to the EU said that if the euro continues to weaken, then the second half of the orders from the European Union market, not only may be much reduced, and export growth will also slow down the EU. On the other hand, continued depreciation of the euro there will be exporters of furniture exports to the EU increased settlement costs, product prices less competitive, in the second half to reduce the plight of the total exports, but this is only temporary. EU economy, politics, senior experts generally optimistic about the euro, the euro enhance the competitiveness of the EU market will gradually recover. So hard to predict: the end of this year and early next year, import and export trade between China and the EU will gradually rise.
My academic economist’s view on the euro depreciation varies, the modest appreciation of the RMB controllability generally more optimistic. Chinese Academy of Social Sciences Institute of World Economics and Politics Song Hong International Trade Research Office, said: The European impact of the debt crisis has not reached the level of the real economy. It is different with the financial crisis, financial crisis is the primary cause of decline, now that the debt crisis is to stimulate economic growth in the course of the problems of the impact is much smaller, even if the impact on the real economy, it also takes a very long time. Overall, the RMB appreciation will first affect China’s exports, however, modest appreciation is not unbearable. Hai Tong Securities chief analyst Chen Lu macroeconomic view, the status of the export enterprises may be the biggest problem is the shortage of labor ("labor shortage"), triggered by rising costs and shortage of capacity utilization, rather than worry about the order before the issue of the RMB modest rise slightly, probably more of a benefit. Therefore, China furniture export companies to hold its ground, positive euro bailout to survive the temporary difficulties caused.
Third, actively respond to the euro cooperation and win-win tomorrow
Depreciation of the euro, spread to many countries trade with the EU, companies how to trade in the currency depreciation due to minimize economic losses, this is the furniture export enterprises are most concerned about. Natural depreciation of the euro as the EU market, the market demand for auto-reduction, designed to avoid risk, reduce economic loss of profits, in order to survive temporary economic difficulties. Meanwhile, volatility in the global market economy, the occasion, the furniture industry not to "put their eggs in one basket", should be divided into enterprise risk sections in the different markets in order to achieve the face of financial turmoil and safe. Economic recession, the export enterprises should actively try to expand in North America, Middle East and other emerging international markets, the risk of development of the crisis into an opportunity.
As a result, foreign trade experts advise: Since there is still no European sovereign debt crises are signs of improvement, the euro market, prospects for recovery is not clear, the euro will break "8", or how long the euro would also be very difficult to judge, not the face of the current unforeseeable circumstances, the exporters in the Eurozone market enterprises signed contracts should be as flexible and go "quick" route to short-term contracts mainly small, can use the U.S. dollar clearing, appropriate reduction in the euro entered into non-dollar currencies such as clearing contract . Business-to-export business, especially the U.S. dollar clearing business, may enter into with banks handling foreign exchange business forward, that production costs under the company’s payment of the exchange rate lock customers in the exchange rate changes, the company hardest hit is not too much.
Export enterprises to make better use of various financial products to avoid the risk of exchange rate differences, in order to ensure that enterprises have a higher value of export. If the euro continues to weaken, to avoid risks to reduce economic losses, may reduce the EU market based on market orders, price leverage to adjust, but in this case the price cuts, corporate profits little, the state can introduce relevant policies, such as export tax rebates, the price subsidies to help the EU market recovery, encouraging domestic enterprises to actively integrate into the rescue, riding out the storm together. If the continued depreciation of the euro will result in continued deterioration of the European Economic Area, will inevitably spread to other international trade area already are signs of recovery in the EU import and export business may suffer damage. Therefore, economic globalization and integration of today, we should be hand in hand, side by side, the EU implementation of international assistance, cooperation and win-win future! ,
2010-7-21
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