Home / Knowledge / News / Textiles / Exchange rate Change affects Jiangsu textile enterprise

Exchange rate Change affects Jiangsu textile enterprise

15
Jan '07
"Constant changes in RMB exchange rate in 2006 certainly had big impact on our company, but not fatal. We still achieved some profits after mentally preparation for the changes in exchange rate" said Mr Yao, manager of finance department from Jiangsu Hongye International Group.

The changes in the exchange rates are uncertain, it takes some time for the payment of goods to reach the company's account after the shipment. When the payment comes, the exchange rate has changed, the bank will transfer the US dollars into Renminbi according to the exchange rate by the day, so the currency exchange rate risk is all on enterprises. "Originally one dollar can be exchanged for 8.27 yuan, now it is below 7.8 yuan, the profit margins have been compressed." Yao said.

The Group chairman Liu Sui Chi said, "The monthly export amount of our Group is over US $20 million. Now exchange rate has been decreased from 8.07 from the beginning of the year to below 7.8. We lose nearly 0.30 yuan on one dollar, the annual losses would be close to 100 million yuan, if we do not adopt any means to circumvent the risks.

Fortunately, the enterprise has managed to control the losses to the minimum through flexible adjustment in product structure and business contracts.

Mr.Yao does not approve monetary policy. "Last year we tried many types of financial instruments, such as advanced banks negotiation and buying forward foreign exchange, but experience showed that we only paidtuition.”

Generally speaking, the enterprise has mastered more means to avoid the risk of renminbi exchange rate, and the profits would not be greatly affected in the next few years.

Fibre2fashion News Desk - China


Must ReadView All

Pic: Shutterstock

Textiles | On 16th Oct 2021

China's economic growth reflects strong resilience, vitality: Li

Premier Li Keqiang has said China is capable and confident of...

Pic: Shutterstock

Apparel/Garments | On 16th Oct 2021

BGMEA urges Bangladesh govt to reskill & upskill RMG workers

The Bangladesh Garment Manufacturers and Exporters Association...

Pic: Shutterstock

Retail | On 16th Oct 2021

UK retail sales rises by 0.6% in Sep 2021; figure 5.6% in Sep 2020

Total UK retail sales rose by 0.6 per cent in September this year...

Interviews View All

Textile Industry, Head honchos

Textile Industry
Head honchos

Trainers faced immense challenges as most were not tech-savvy

Textile Industry, Head honchos

Textile Industry
Head honchos

Next level is to inject new features:

Textile Industry, Head honchos

Textile Industry
Head honchos

Marry with brand ethos

Abdullah Mohammad Saad Hossain,

Abdullah Mohammad Saad Hossain

Saad Group is a leading vertically integrated textile group in Bangladesh. ...

Harleen Kaur,

Harleen Kaur

Established in 2017 and headquartered New York, the label Harleen Kaur...

Chendhuran Sundar,

Chendhuran Sundar

It manufactures and retails menswear garments in India under the brand...

Shujaul Rehman, Garware Technical Fibres

Shujaul Rehman
Garware Technical Fibres

Garware Technical Fibres Ltd (formerly Garware-Wall Ropes Ltd) is a...

Dr Anup Rakshit, ITTA

Dr Anup Rakshit
ITTA

The Indian Technical Textile Association (ITTA) is the only association of ...

Ian Russell, Pireta

Ian Russell
Pireta

UK-based Pireta has developed a unique free-form process to add durable,...

Shalini Sharma & Shweta Pundir Sharma, Six Yard Story

Shalini Sharma & Shweta Pundir Sharma
Six Yard Story

Six Yard Story is a premium artisanal brand with a focus to bring handloom ...

Samant Chauhan, Samant Chauhan

Samant Chauhan
Samant Chauhan

Delhi based fashion designer, <b>Samant Chauhan</b> who mostly works on...

Megha Kumari & Jigar Mali, Label Megha & Jigar

Megha Kumari & Jigar Mali
Label Megha & Jigar

New Delhi based label Megha &amp; Jigar blends India's unique handcrafts...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

Leave your Comments


October 2021

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.


Advanced Search