Chinese Shoe Companies Test Water Cross Border Trade RMB Settlement

International experience shows that the pace of "going out" of a country's currency is fundamentally dependent on the overall national strength of the country and the competitiveness of the multinational enterprises.

The pilot of RMB settlement in cross-border trade is obviously China.

Located in the shoe gathering area of Wenling Hengfeng, Taizhou Thai River Shoes Co., Ltd. is the 19 local company.

Wang Jianglin made a calculation: the contract price of shoes signed between foreign businessmen and foreign businessmen was 4 US dollars / double. According to the exchange rate of RMB 6.599 against US dollar in January 13th this year, the cost of a pair of shoes to the enterprise account was 26.396 yuan RMB, and delivered at the end of April. According to the 6.499 to 1 exchange rate at that time, the actual amount of the money was only 25.996 yuan, and the difference of the price of a pair of shoes reached 0.4 yuan. The larger the quantity, the greater the difference.

But when RMB is settled, there will be no such problem.

"Now when I see a new client, I first ask him if he is willing to settle in RMB. If the other party is willing, he will take the order first."

Wang Jianglin said.

Nowadays, more and more enterprises have tasted the sweetness of cross border trade RMB settlement as tajiang shoes industry.

Statistics from the Hangzhou central sub branch of the people's Bank of China show that the number of participating enterprises has increased from the initial more than 90 to the end of 6 this year, and the settlement volume has also soared. The total settlement amount in the first half of this year has reached 100 billion 587 million yuan, which is more than 8 times the half yearly settlement in 2010.

According to the current minimum bank exchange cost of 0.2%, cross border trade settlement in the first half of this year has at least saved 133 million yuan for enterprises.

"The smooth implementation of the cross-border RMB trade settlement experiment fully reflects the market's practical demand for cross border use of RMB."

Zheng Nanyuan, vice president of Hangzhou central sub branch, said.

He took out a stack of reports and detailed analysis: when the pilot was launched in the second half of 2010, the monthly amount of cross-border RMB settlement in Zhejiang was only 1 billion or billions of yuan, and the total settlement amount at the end of the year was only 12 billion 300 million yuan.

This year can be said that a turning point has taken place. In January and February, the settlement volume exceeded 5 billion yuan, and in March exceeded 10 billion yuan.

In June, it exceeded 30 billion yuan, and the total settlement amount in the half year exceeded 100 billion yuan, ranking the fourth among all provinces and cities in the country.

As of the end of 6 this year, Zhejiang has accumulated cross-border RMB settlement business with 58 countries and regions.

Not only is the volume increasing, but the composition of cross-border RMB settlement business is also changing.

Zheng Nanyuan disclosed that in the early stage of the pilot, the cross border RMB business in the whole province only involves RMB settlement of trade in goods, and has now extended to service trade, income and regular pfer, RMB outward direct investment, foreign direct investment in Renminbi, cross-border RMB trade financing, and personal currency guarantee.

Among them, cargo import trade settlement, re export trade settlement, cross-border RMB trade financing became the main business of our province, and the total settlement volume in the first half of this year was nearly 100 billion yuan, which occupied a large part.

This has many advantages for Zhejiang, one of the most important import and export trade bases in China.

In Zheng Nanyuan's view, there are at least four advantages in using RMB to carry out cross-border trade settlement: first, it helps to avoid exchange rate risks; two, because of the use of single currency, the operation cost is clearer and easier to calculate the cost and revenue; three, the two exchange rate and the double exchange rate of import and export are reduced; four, it speeds up the settlement speed and improves efficiency.

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To eliminate bottlenecks, buyers and sellers want to use them more.

Although cross-border RMB settlement has begun to rise, it is far from a single level.

On the contrary, there are still many bottlenecks to be resolved.

First, overseas buyers, especially those from developed countries in Europe and the United States, do not accept RMB very well.

As the appreciation of the renminbi is expected to be stable, many foreign businessmen are unwilling to shift the risk of exchange rate change to their own heads.

Wang Jianglin acknowledges that there are not many foreign merchants willing to accept renminbi settlement in daily trade.

"Not only are we doing accounts, but foreigners are also doing accounts, because the appreciation of the renminbi is a general direction, so foreign investors are reluctant to take the risk of exchange rate pfer from Chinese enterprises."

However, he is still optimistic about the prospect of cross-border RMB settlement.

Secondly, the total amount is relatively small.

The head of the Zhejiang provincial chamber of Commerce said that although Zhejiang's total volume of trade in goods settled in Guangdong, Beijing and Shanghai in the first half of this year, it ranks the fourth in the country, but it still has a lower proportion than the total volume of import and export trade in Zhejiang.

According to the statistics at the end of 6, the total settlement volume of goods trade (excluding trade in services settlement) in the first half of Zhejiang is less than 4% compared with the total volume of import and export trade in the same period.

Structural imbalance is also a problem, which is mainly manifested in the imbalance of RMB settlement in import and export trade.

According to statistics, from 1 to June this year, the proportion of RMB settlement in Zhejiang's import and export trade was 31.6: 1, and exports were obviously weak. In the same period, the proportion of RMB settlement in the import and export trade of goods was 9.7: 1, far below the proportion of the whole country.

In addition, enterprises participating in cross border RMB settlement still have considerable potential to tap.

As of the end of 6 this year, there were 1748 enterprises in the whole province that had paid up and paid in real estate business. Compared with the 40 thousand import and export enterprises and 6709 first export pilot enterprises in the whole province, the participation of enterprises is obviously not big enough.

In this regard, the Central Bank of Hangzhou central sub branch held that there are many reasons for the bottleneck. For example, many foreign countries and regions have not received enough RMB acceptance, and foreign currency settlement currencies are missing. The scale of foreign currency is still small, liquidity is insufficient, investment and financing channels are not smooth, the degree of internationalization of overseas Chinese banks is not high, and the impetus for RMB settlement is not enough.

For example, banks in different regions have different liquidation systems between the mainland and Hongkong, which makes it difficult for enterprises to manage funds effectively and reduce the efficiency of commercial operation.

Because mainland partners do not have Hongkong accounts, Hongkong enterprises have no choice but to abandon cooperation.

Compared with the aforementioned factors, the limited reflux channel of foreign exporters and exporters is regarded as the biggest bottleneck for the further development of RMB cross-border trade settlement.

At present, in addition to real trade, the policy window for RMB reflux is limited to three aspects, such as overseas clearing bank, and other limited aspects of domestic interbank bond market.

The direct effect is that the Renminbi that the overseas traders or institutions get is nowhere to go, which leads to the lack of attraction for RMB settlement to overseas institutions and traders.