Not much influence on common people, enterprises should cope actively
Exchange rate reform has caused great effect on domestic and foreign financial markets, but ordinary people are calm about it. On July 22, the reporter saw in the
Industrial and Commercial Bank of China, the Minsheng Banking Corporation,
Beijing Bank and other banking outlets in Beijing's Finance Street, there was no such scene of people standing in queue waiting to convert their US dollars into the RMB. A staff member of an outlet said frankly that the business volume was about the same as at ordinary time.
Calmness is not tantamount to unconcern. Calmness is a kind of rationality. Dr. Mei Xinyu, a researcher with the Research Institute of the Ministry of Commerce, explained when he said that there was not much US dollar in the hands of most ordinary people and the range of the revaluation of the RMB to the US dollar is very small.
Furthermore, while reforming the exchange rate, the central bank also announced adjusting up the interest rates of small amount deposits of the domestic US dollar and Hong Kong dollar. Obviously, this move has helped increase the returns on foreign currency investment. The combination of these effects will naturally weaken common people's motives to convert the US dollar into the RMB.
In experts' opinion, the common people may at least enjoy three major benefits from the exchange rate reform. Firstly, a minor appreciation of the RMB will appropriately lower the prices of imported commodities, stabilize domestic price and convenience the people's daily life;
Secondly, people going abroad convert the same amount of RMB into more US dollars. It is more worthwhile for consumption abroad;
Thirdly, along with exchange rate reform, the quickened pace of opening to the outside world, and the possible further relaxation of foreign exchange control such as the limit on the amount of foreign exchange to be converted, and limit to the amount of foreign exchange to be brought in and out of the country, the common people can obviously profit therefrom.
Even if you have US dollar deposits in your hand, that doesn't all mean that this sum of money has lost 2 percent for nothing, regarding this, Governor Zhou Xiaochuan of the central bank put it in plain language, "If your (foreign exchange deposit) is in US dollar, it still depends on whether you want to convert it into the RMB. If you exchange it at the moment, you may lose 2 percent compared with the past, but if you plan to keep these US dollars for other purposes, for instance, for touring abroad, or for purchasing something when going abroad, or for the children to study abroad, then their purchasing power remains as before, without any change."
Compared with ordinary people in a calm condition, enterprises have a more complicated heart.
Exchange rate reform has different effects on different trades. Mei Xinyu said that generally speaking, exchange rate reform has influence on light industries, such as textile industry that depends heavily on exportation; it "benefits" iron and steel industry that imports more raw materials; for energy enterprises that import a huge amount of goods, the price of their commodities calculated with RMB may fall; the automobile industry will possibly sustain a certain price-cut pressure, because not only the price of its imported components, calculated with RMB, falls, but the costs of iron and steel and other input also drop as a result.
The "Cheese" has been moved, shall one complain, wait and see, or cope with it actively?
Zhou Xiaochuan said, "The tactic for enterprise adjustment should be aimed at enhancing one's own competitiveness, product upgrading, striving for a good selling price, and overcoming the negative influence brought on the enterprise by such changes in other aspects."
Wu Xiaoling, deputy governor of the central bank, recently indicated that enterprises should strengthen study and application of derived tools and actively adapt to changes. The central bank is vigorously promoting the development of derived products and provides society with risk-avoidance tools as soon as possible.
What is most crucial is that enterprises should gradually foster a partiality for flexibility.
Zhou Xiaochuan expresses the view that in the process of reforming the exchange rate mechanism, enterprises should change their fixed partiality. Previously, the various conditions of enterprises were comparatively fixed, but now they are faced with more and more changes in the market conditions, so they should begin to learn the skill of making various adjustments.
In terms of micro-economy, the greater degree of flexibility, the more is there a market saturation rate, and the more is it possible to adapt to the current change. The exchange rate mechanism, as a price mechanism, is a component part of the macro-economy, at the same time, it can also reflect the entire objective situation of world economy, trade and capital flows. These changes in the objective environment also require response from the enterprises.
English home
