Advantages and disadvantages of traditional RMB

First, the benefits of RMB appreciation:

(1) The appreciation of RMB may mean the improvement of the status of RMB and the promotion of China's economy in the world economy.

1) The wealth in the hands of ordinary people in China is more valuable. With the appreciation of RMB, the money in the hands of ordinary people is more valuable, and the global ranking of China's per capita GDP can also move forward.

2) The reduction of China's foreign debt pressure and the enhancement of its purchasing power.

For example, who is paying for the daily operation of the US government, which is known as the "global boss"? The natural answer is American taxpayers. This answer is not entirely correct. Because the current US federal government has a huge fiscal deficit, it is not enough to rely solely on the contribution of taxpayers, so it has to borrow a lot. Who is the biggest creditor? It's Japan and China. China's foreign exchange reserves exceed $300 billion, a large part of which is purchased from US Treasury bonds.

China became one of the biggest creditors of the most powerful empire in the world. This fact itself shows China's growing economic strength and international influence. Last year, China's contribution to global economic growth was second only to that of the United States; Its contribution to global trade growth is second only to that of the United States and Japan. * It is a good thing that the RMB, whose economic strength speaks, naturally gains a greater voice in international affairs.

3) Conducive to the development of the import industry: Shao Jinyang, deputy general manager of China Petrochemical, said in an interview: "If the RMB appreciates, overseas assets will be cheaper for us." If RMB appreciates by 5%, the cost of China Petrochemical's oil import in 2003 will be reduced by more than $654.38 billion at current prices.

(2) The prospect of RMB appreciation is becoming clearer and clearer.

This is because, just as the policy of artificially overvaluing the value of RMB before 1994 was forced to give up, artificially underestimating the value of RMB is also unsustainable, because on the exchange rate issue, although policy intervention can play a temporary role, the market has the final say. As long as China can maintain a high economic growth and promote the full convertibility of RMB, it will not be too long before RMB appreciates and becomes a regional and even world currency. At present, there is not enough evidence to show that China's economic growth will suddenly stop in the near future; China's monetary authorities have repeatedly stated that RMB will be fully convertible.

In fact, the rising journey of RMB has already started, starting with the sharp depreciation 1 994 65438+1October1 In this year, the official exchange rate of RMB converged with the market exchange rate, from 1 USD to 5.80 RMB in the previous year to 1 USD to 8.70 RMB, with a depreciation rate of 33%. From then until the end of last year, according to the statistics of the State Administration of Foreign Exchange, the nominal appreciation of RMB against the US dollar, the euro (before 1999 was the German mark) and the Japanese yen was 5. 1%, 17.9% and 17% respectively. Considering inflation, the actual appreciation ranges are 18.5%, 39.4% and 62.9% respectively. The calculation results of the International Monetary Fund also reflect the same trend.

Even so, at present, it is not realistic to try to induce a sharp appreciation of the renminbi.

Second, the disadvantages of RMB appreciation:

(1) Affected by the appreciation of RMB, China's economic growth will slow down. It is manifested in three aspects:

1) RMB appreciation will affect China's foreign trade and exports. The appreciation of RMB will increase the price of China products, increase the cost of capital investment, and reduce the competitiveness of China's export products, thus causing domestic economic depression.

The appreciation of a country's currency brings about the decline in the competitiveness of its export products, which leads to the depression of its domestic economy. Japan has learned a bloody lesson on this issue. 1985, in order to curb the export frenzy of cheap Japanese goods, the financial leaders of the United States, France, Germany and Britain took corresponding measures to force Japan to sign the Plaza Agreement, thus forcing the yen to appreciate by 30%. Since then, from 1985 ~ 196 to 10, the ratio of Japanese yen to US dollar has risen from 250: 1 to 87: 1, with an appreciation of nearly three times. "Plaza Agreement" is generally acknowledged as the chief culprit of Japan's economic recession. Now the Japanese want to pass this tragedy on to China.

2) It will also affect the comprehensive competitiveness of China enterprises and many industries. Because despite "China"

"Made in China" has become the main product in the world market, but a fatal weakness of China products is that they have not yet formed their own brands. At present, their market share is mainly due to the low price of China products, and they are not in an advantageous position in the competition. It would be terrible if their competitiveness was hit.

The biggest discovery of this survey by China Entrepreneur is that 82.4% of enterprises believe that the change of RMB exchange rate will have an impact on their business activities. For enterprises active in China's economic arena, RMB is like air and water.

For example, Huang Hongsheng, chairman of Skyworth Group, the owner of a large color TV exporter in China, is worried about the prospect of RMB appreciation. He believes that most of China's exports are low-tech products and few are high-tech products. If RMB appreciates, China's international status may be improved, but the global competitiveness of manufacturing industry will gradually lose. He calculated an account. If RMB appreciates by 10%, it means that the export price has increased by 10%, while the profit of domestic manufacturing enterprises in China is only about 5%. Coupled with some financial interest subsidies, the average profit level of Chinese enterprises is less than 3%. How does the average profit rate of 3% adjust the appreciation pressure of 10%? There is bound to be a large-scale loss.

Taking Skyworth as an example, Huang Hongsheng outlined the highest psychological bottom line for China enterprises to appreciate RMB: "It is difficult for us to make a big improvement in the American market now, largely because the prices of products from other world factories are as low as ours. For example, Mexican color TV sets, European and Turkish products are very cheap, and we can't raise a dollar. We hope to increase sales of 30 million US dollars in the US market this year, but if the RMB appreciates, then this plan will be aborted. "

For another example, compared with manufacturing enterprises, those foreign trade enterprises that are at the forefront of exchange rate risk have the strongest perception of change. For export-oriented enterprises, the export volume is far greater than the import volume. Therefore, Huang Hongsheng said that the appreciation of the RMB will cause a devastating blow.

Huang Fangning, assistant general manager of Oriental Scientific Instruments Import and Export Group, told the reporter an example of losses caused by the appreciation of the euro-that is, the depreciation of the RMB. In early 2003, they reached an agreement. When signing the contract, the exchange rate between the euro and the US dollar was still 1:0.9. It rose to 1: 1. 1 at the time of delivery. They didn't do anything to lock the exchange rate, so they lost money. "Even if we have an intermediate profit of 10% and 20%, it is not worth the loss of appreciation. I can only make it up by myself. "

For another example, some multinational companies that used to produce in China may transfer their investments to Mexico or Malaysia. In the1980s, Taiwan Province Province also experienced the current pressure from China. After the exchange rate of Taiwan dollar rose from 1:40 to 1:25, some traditional low value-added industries moved to Dongguan. Similarly, some experts have analyzed that if the RMB appreciates, these traditional industries will be transferred from Dongguan to less developed areas such as Central Asia and Vietnam. Originally, there were many areas in China, such as the west, which could accommodate these industries. However, because the currency adjustment is aimed at all enterprises, China may be forced to experience the process of industrial hollowing out ahead of schedule.

3) It will also undermine the long-term development of China's economy and bring China's finance to the brink of crisis.

The edge is getting closer. The appreciation industry may destroy the good investment environment that China has worked hard to create for many years, and the new overseas investment will be reduced, which will greatly reduce the driving force of China's economic growth, because such investment will become relatively expensive. On the other hand, the speculation of international hot money may increase, which makes China's finance more and more close to the edge of the crisis.

For example, from the Mexican financial crisis to the Asian financial crisis, it is obvious that the governments of these countries have adopted monetary policies with high interest rates to absorb domestic funds, but the effect is counterproductive. Due to the lack of internal funds, it attracted a large number of international hot money inflows, which led to the deviation of capital flow and the contradiction of capital structure, laying a hidden danger of currency crisis; At the same time, the contradiction of foreign capital inflow pushing up the exchange rate of the local currency leads to the exposure of economic structural problems, or the bubble economy or economic downturn, which forces the implementation of the policy of depreciation of the local currency, directly leads to the transaction risk in the money market and the securities market, and finally leads to the financial crisis.

What is the financial crisis? It's like a poor family with a rich relative.

It brought them a temporary "rich" life, so outsiders lent it huge amounts of money because of the family's wealth. Unexpectedly, the rich relatives of this family suddenly disappeared, leaving this family with only high debts, which led to a friend borrowing huge debts. At that time, there were many dangers.

It can be seen that if the RMB appreciates, it will lead to: due to insufficient internal funds, it will attract a lot.

The inflow of international hot money has caused the deviation of capital flow, formed the contradiction of capital structure and buried the hidden danger of currency crisis.

4) Also, the appreciation will inevitably lead to the prevalence of speculation: because of the dollar-denominated countries

People's wealth has increased rapidly, the stock market and real estate have reached a climax, some "bubbles" have further expanded or created new "bubbles", and polarization has continued to expand, leading to the inevitable prevalence of speculation.

For example, many retail investors in the United States have opened RMB savings accounts in the local area, hoping that one day changes in the RMB exchange rate system will benefit them. Of course, these retail accounts are not real RMB accounts, because according to China's non-convertible exchange rate system, it is illegal to open RMB accounts abroad. They open RMB savings accounts. The deposits in the accounts are USD, but based on the spot exchange rate of RMB, these accounts will appreciate or depreciate due to the fluctuation of the spot exchange rate of RMB against USD. Frank Trotter, CEO of Everbank, said that the company's actions had a great response among some customers. Since the RMB exchange rate began to show signs of imbalance more than a year ago, these customers have been asking for RMB-denominated accounts. Everbank launched the new account on July 1 and injected more than 6.5 million dollars into the account in the following weeks.

(5) In addition, there are many disadvantages of RMB appreciation:

The appreciation of RMB will bring greater pressure to China's deflation; The appreciation of RMB will definitely lower the price, because the price of imported goods will fall.

The appreciation of RMB will increase employment pressure and worsen the current employment situation: foreign-invested enterprises are an important channel to attract domestic labor, especially now, so the appreciation of RMB will not only affect attracting foreign investment, but also aggravate the current employment situation.

The fiscal deficit will increase due to the appreciation of RMB exchange rate, and it will also affect the stability of monetary policy.

The appreciation of RMB will cause serious damage to China's advantageous industries. As a developing country, China has the advantage of labor cost. China's labor-intensive export products are easily restricted by anti-dumping measures, and the export situation is not optimistic. At this time, RMB appreciation will worsen the current situation, so RMB appreciation at this time will not only affect attracting foreign investment, but also aggravate the deterioration of the current employment situation.

Third, in the face of global deflationary pressure, the world once again focuses on the RMB.

The change of exchange rate is closely related to domestic interest rate level, money supply, national income level and price level. Whether a currency appreciates or depreciates should be decided by the market, not politics.

However, Masajuro Shiokawa's proposal is more like a political conspiracy. Holding a RMB of 100 yuan, if a child asks: How much is this worth? Then, the child must be too naive to learn to use money. If Japanese Finance Minister Masajuro Shiokawa asks, how much is this worth? Then, this will cause a storm And this storm is a proposal made at the meeting of finance ministers of the Group of Seven-Japan's demand for RMB appreciation.

Recently, the discussion about whether the RMB should appreciate has become a topic of great concern all over the world. First, Japanese Finance Minister made a request at the meeting of finance ministers of seven countries, and then US Treasury Secretary Si Nuo's speech and the statement of the Asia-Europe Meeting held in Indonesia called for RMB appreciation. Recently, the US "Acoustic Dollar Alliance" proposed to promote RMB appreciation through "30 1 clause". Greenspan's speech made the world focus on RMB again under the pressure of global deflation. It can be said that the government and the people joined hands to attack the RMB exchange rate issue. This dispute over RMB exchange rate, which was provoked by Japan and starred by the United States, was staged in an all-round way, once again making China the center of world attention.

In fact, from the standpoint of the Japanese, it is not unreasonable for Masajuro Shiokawa to raise this issue. First of all, the Japanese economy has been at a low ebb. Why do you stand out in China? China outshines others, and we Japanese also contribute. Look, how many goods Japan has imported from you. Secondly, only when the renminbi appreciates can the yen depreciate, so that Japanese exports can be competitive. China's economy has three advantages: cheap labor, high technology level and cheap currency. Among these three factors, the only one that Japan may intervene is the RMB exchange rate. Japan even wants to use the "negative" of RMB appreciation to prevent domestic enterprises from investing in China, but in market economy countries, the government cannot interfere with the behavior of enterprises, so it requires RMB appreciation. In their view, this can raise the price of China products and increase the cost of capital investment, so that they can't achieve their goals by exerting pressure on the RMB at home.

Forcing the RMB to appreciate is a strategic measure for Japan to compete for the hegemony of the Asian dollar in the future. In recent years, the discussion about "Asian dollar" has become more and more hot, and who can become the leader of Asian dollar in the future has become an increasingly sensitive topic. As Japan's economy has been in recession for ten years, it is less and less likely that the yen will become the dominant currency in Asia. However, due to the rapid economic growth, China has gradually become the "locomotive" of Asian economic development and the "engine" of world economic development, so the value of RMB has become increasingly obvious, and countries around China have begun to form a "RMB zone", which has aroused Japanese anxiety. Against the background of Japan's surplus of $5 billion with China in 2002, Japanese Finance Minister Masajuro Shiokawa proposed a motion to ask the G-7 to adopt "a document similar to the 1985 agreement on the Yen Plaza" to force the appreciation of the RMB, so as to push the global voice of suppressing the appreciation of the RMB to the peak, with the aim of defeating the challenge of the RMB to the yen through the appreciation of the RMB and ensuring the dominant position of the yen in the future.

The motive of the United States and Europe seems to be more obvious, that is, weakening China's economic strength through RMB appreciation, thus hitting China's international influence.

The dispute over RMB exchange rate is essentially a dispute over trade issues. The reason why the United States pressured RMB to appreciate is that the depreciation of the US dollar only "greatly enhanced the export competitiveness of China enterprises and stimulated the export of China products". Especially in 2002, the US dollar depreciated, and the US foreign trade deficit reached a historical peak of US$ 435.2 billion, and the trade deficit with China reached US$ 103 1 billion. The United States hopes to prevent China goods from entering the United States on a large scale through RMB appreciation.

There is increasing international pressure for RMB appreciation. Although in the long run, with the development of China's economy, RMB appreciation is an inevitable trend, the nominal exchange rate of RMB should not be greatly adjusted before China's real export advantage (brand) is formed; Even in the face of enormous international pressure, China should control its exchange rate according to the needs of its own economic development, otherwise it will ruin its excellent economic prospects like Japan and Germany.