Control risk for foreign trade enterprises

Since the beginning of this year, COVID-19 has brought great difficulties to international trade. At the beginning of this year, foreign trade enterprises in Ningbo were generally caught in the dilemma of shrinking orders or even canceling orders. Although the overall foreign trade export of Ningbo recovered quickly from the second quarter, and has maintained positive export growth in the same month for eight consecutive months since March, with the coming of autumn and winter season, the overseas epidemic situation became severe again, bringing more difficulties to international trade. Recently, Ningbo Council for the Promotion of International Trade (CCPIT) organized the training conference on the layout of the new "double cycle" pattern and the promotion of foreign trade innovation and development, and invited Wang Xiaoming, senior consultant of Ningbo E-commerce Research Institute, Zhejiang Tianbook (Ningbo) Law Firm, and Wu Chaolan, chairman of Yitong Management Consulting (Zhuhai) Co., Ltd. to make keynote speeches respectively. More than 500 enterprise representatives attended the conference, covering automobile parts, cross-border e-commerce, machinery, food industry and other industries.

Focus on international trade risks

"From the perspective of the global supply chain, only a few countries, such as Japan and the Republic of Korea, have been successful in epidemic prevention except China, which has basically returned to normal. The global trade and supply capacity has dropped significantly. This is both an impact and an opportunity," he said. Wang xiaoming said that economic globalization has encountered adverse trends and economic and trade frictions have intensified. Enterprises should timely adjust their industrial layout and global resource allocation based on factors costs and trade environment.

Among them, enterprises need to follow the new development concept of domestic and international double cycle. "In the current external environment of rising trade protectionism, sluggish world economic situation and shrinking global market, we should give full play to the advantages of China's super-large market, and add impetus to China's economic development and drive world economic recovery by prospering the domestic economy and unimpeded domestic circulation." He reminded enterprises that during this period, enterprises should enhance the modernization level of industrial chain and supply chain, vigorously promote scientific and technological innovation, accelerate the key core technology research, and enhance the domestic share.

Pay attention to the escalation of trade risks. Although the state has issued a series of policies to encourage small, medium and micro enterprises to go global, enterprises still need to take the initiative to adapt to new trends and changes in foreign trade. He said that in the process of going global, many enterprises have deficiencies in corporate governance, organizational management structure, policy formulation, process management and other aspects. Moreover, they are not familiar with the politics, economy, culture, religion and laws of host countries, which leads to increased friction with local enterprises, communities and governments. All these are not conducive to enterprises going global.

He reminded enterprises that when they invest abroad, they need to properly implement domestic legal procedures such as application for approval of investment projects, application for registration of overseas companies, registration of cross-border guarantee and registration of foreign exchange funds. Due diligence should be conducted on the legal environment of the host country to ensure that the investment and follow-up business activities are carried out in accordance with the provisions of local foreign investment; Meet the country of origin requirements of the exporting country.

Do a good job in controlling exchange rate risks

On November 15, the regional Comprehensive Economic Partnership (RCEP), which includes the 10 MEMBERS of asean plus China, Japan, South Korea, New Zealand and Australia, was formally signed, marking the birth of the world's largest free trade area.

For foreign trade enterprises and cross-border e-commerce practitioners, how to obtain greater market opportunities through RCEP is the most concerned issue. Wu Chaolan, chairman of Yitong Management Consulting (Zhuhai) Co., LTD, said bluntly that the opportunities brought by RCEP to export enterprises are mainly reflected in two aspects. One is tariff and tariff barriers. After the SIGNING of the RCEP, tariff barriers within the region will be gradually removed and reduced, which will maximize the expansion of international trade and flow of goods, and make it easier to buy and sell goods globally within the region. The other is that the 10-member ASEAN market has more potential than Europe and the United States. "In recent years, it has become more difficult to do business in the traditional markets of Europe and the United States. It is an inevitable trend to expand the asean market and the One Belt And One Road market. With the support of such trade agreements, domestic foreign trade enterprises can expand their power in the regional market."

The implementation of RCEP will significantly reduce the transaction costs of imported goods, especially cross-border e-commerce importers, so that customers can buy high-quality overseas goods at lower prices. In addition, technology output and data trade have become new highlights. "In addition to capital input, financial data export, higher quality export mode is the biggest trend in the future." "Said Wu Chaolan.

At present, the RMB exchange rate continues to appreciate, how do import and export trade enterprises do a good job in exchange rate risk control? "Calculate the cost of each order and quote the exchange rate according to the required cost." Wu Chaolan believes that the exchange rate is constantly changing recently, so enterprises should adjust the price frequency according to the order cycle. It is suggested to set the price frequency to 1-3 months, and make a more competitive price based on the analysis of the trend of the future exchange rate. In addition, the product is different, the profit is different, the different period adopts the different quotation strategy. Quote in different currencies, combined with hard currency and soft currency. "Of course, companies also need to control foreign exchange to protect their legitimate interests.