Euro devaluation eats China's exports to Europe

For some, it is now a good time to go shopping in Europe, as the renminbi's rise against the euro means that the renminbi is now spending less than last year in Europe, but the change in exchange rates is no doubt a bad news for trading companies exporting to Europe.　　Euro-income enterprises suffer exchange losses first, those trading companies that received orders last year and who recently had euro income have to endure huge exchange-rate losses, as euro revenues will shrink when they are converted into renminbi at home.　　Some companies ' profits may have been wiped out by changes in exchange rates, and Bank of China analyst Benji told reporters that it is a bit late to recover the damage, but the euro's fall in the contract is certainly unexpected, since such event-driven changes are unlikely to be predicted in advance.　　Companies may have to suspend settlement of euro income at the moment, but it is not clear when the euro will reverse the decline, and such a move could have a big impact on corporate capital flows.　　The international Department of a domestic commercial bank said to reporters, future euro income can be locked in the long term, or in the Bank for export trade financing to advance settlement, but even so, the loss has been caused, unless the company in the position of trade is strong, so you can negotiate with the importer to amend the contract.　　Price competitiveness disappears Secondly, the appreciation of the renminbi against the euro will make European importers feel that Chinese goods are becoming more expensive and that the loss of price competitiveness will adversely affect domestic exports.　　According to reporters, Societe Generale's chief economist, Lu, in their data model, the renminbi's rise against the euro has been well aligned with China's year-on-year growth in Euro-zone exports, about three months after its decline. He pointed out that, according to historical experience, if the renminbi's appreciation against the euro in the coming period is "sustained" at an annualised rate of about 10% per cent, China's exports to the eurozone will fall to single-digit rates year-on-year, and if appreciation "sustained" in the 10%~20%, there will be single-digit negative growth in exports to the eurozone.　　, if the appreciation range "sustained" in 20%~30%, then the export may appear double-digit negative growth. Lack of external demand again, because of the debt crisis, the eurozone must undergo a few years of fiscal austerity, the eurozone's economy may be damaged, and its need for commodities may also be reduced.　　The European Union is China's largest trading partner, and a downturn in the eurozone will put domestic and foreign trade at a disadvantage.　　A domestic commercial bank source told reporters that the bank recently appeared in a case of European importers canceled orders, because the banks over there recently refused to open letters of credit to importers. These people stressed that the above is only a case, but if the situation in Europe continues to deteriorate, let such things become a trend, the harm to domestic exports is obvious.