Cost pressures are rushing to foreign trade hardware industry to avoid risks need to be upgraded

Recently, the central bank issued an announcement that it will further promote the reform of the exchange rate formation mechanism and increase exchange rate flexibility, which means that *** will still face upward pressure during a certain period of time. At the same time, the “big screen” of wage increases has recently been opened in many provinces and cities, which means that labor costs have risen further. The rise in many costs has caused a large impact on corporate profitability, especially among foreign trade companies. For the hardware industry in which the export situation is particularly rapid in the first half of the year, the continuous cost pressures have forced hardware companies to accelerate the upgrading of their foreign trade structure and enhance their innovation and competitiveness so that they can stand firm in the fierce market competition. Defeated.

According to my understanding, the tide of salary increase from April 1 this year, Shanghai took the lead in the monthly minimum wage from 960 yuan to 1120 yuan adjustment, then in Jiangsu, Zhejiang, Guangdong, Fujian, Tianjin, Shanxi, Shandong and other 14 The provinces and cities have gradually adjusted the minimum wage standard, and the adjustment rate has been more than 10% , and even some provinces have exceeded 20% .

According to Wang Jinbin, a professor at the School of Economics of Renmin University of China, salary increase is a good thing for the Chinese economy and can achieve the ultimate goal of everyone sharing economic growth results; on the other hand, under the current economic situation, there is no doubt that foreign trade companies have increased. The cost of the short-term impact on exports and growth.

In addition to labor costs, input costs for resources such as land and water are also increasing. Some experts have revealed that the bulk of crude oil, iron ore, and other products in the international market have entered the price recovery channel. As of March this year, China’s primary product import price level has risen double-digitly for four consecutive months, and the increase has increased month by month.

The appreciation of *** will slow the recovery of Chinese exports to the European market, promote the increase of imports, and at the same time aggravate the pressure of competition between Chinese products and the euro zone products in non-eurozone markets.

The high costs put China's foreign trade hardware companies profitability under pressure. Some badly-powered companies can be easily eliminated by the market if they operate indiscriminately. China's hardware manufacturing industry has long been relying on the model of low wages, high consumption, and high emissions to promote growth. It will be difficult to sustain the pattern and the foreign trade structure faces the peremptory force of passive adjustment.

The author believes that the implementation of foreign trade restructuring, the Chinese hardware entrepreneurs should take a gradual approach, can not be done overnight, with the government to carry out appropriate reforms, change passive adjustment for the active adjustment. At the same time, the policies formulated cannot be overkill, otherwise there will be excessive impact and negative impact on companies. As the increase in costs and the appreciation of *** will inevitably reduce the profits of hardware export companies, the original products and markets are no longer profitable. Hardware companies should upgrade their products by developing new products and opening up new markets. Avoid being eliminated.