The appreciation of RMB is a long-term trend, which is beneficial to Zhejiang economy as a whole. On July 2 1, the central bank announced the appreciation of RMB, which marked the enhancement of comprehensive national strength and another important step of market-oriented reform, and probably meant the arrival of a new era of development and reform.

First, the macro background of RMB appreciation

1, RMB appreciation is the inevitable trend of productivity improvement in China.

Since the reform and opening up, the RMB exchange rate has experienced an inverted U-shaped change process from depreciation to slow appreciation (see figure 1). From 1994, the RMB entered a long-term slow appreciation stage. That is, in this year or so, China's economy changed greatly from seller's market to buyer's market. From the macro indicators, the price index of the whole society began to decline; From the institutional point of view, non-state-owned enterprises began to replace state-owned enterprises in an all-round way. The change of RMB from depreciation to appreciation shows that on the one hand, RMB returns to the real exchange rate after long-term depreciation, on the other hand, the rising productivity level supports the continuous appreciation of RMB.

The increase in productivity will inevitably lead to the appreciation of the local currency. Under the dual impetus of institutional changes and technological progress, China's economy has developed rapidly. From 1978 to 2004, China's economy grew at an average annual rate of 9.4%, and its nominal GDP in RMB increased by 2 1 times. Especially since the 1990s, labor productivity has increased significantly faster than that of the United States. From 1990 to 200 1, China's labor productivity increased by 6.75 times, and increased by 3.58 times after deducting the price factor; The United States increased by 1.52 times, but after deducting the price factor, it only increased by 1.29 times. The improvement of labor productivity leads to the reduction of cost. In addition, China enterprises actively improve the quality and grade of their products, and the competitiveness of their products has been significantly enhanced, which has attracted huge demand from developed countries and regions such as Europe, America and Japan for China's goods, which in turn has led to a continuous increase in China's foreign exchange surplus.

Since 1994, China's current account and financial capital account surpluses have been increasing (see Figure 2), forming a double surplus situation. In 2004, China's balance of payments surplus reached US$ 636.8 billion. Exchange rate is the price of currency, which is determined by the supply and demand relationship between local currency and foreign currency in the foreign exchange market. If the demand for RMB in the foreign exchange market exceeds the supply of RMB, RMB will face the pressure of appreciation, and vice versa. China's economy has been growing continuously for more than ten years, and the accumulated balance of payments surplus of more than 600 billion US dollars has formed a huge demand for RMB in the foreign exchange market. It is under this demand that RMB appreciation becomes an inevitable choice.

At the same time, China's foreign exchange reserves have been increasing due to the double balance of payments surplus that lasted for more than ten years. As of June this year, China's foreign exchange reserves reached 7 1 1 billion dollars. Although this is due to the factors of international speculators, the inducement is the expectation of RMB appreciation caused by the strengthening of national strength. The huge foreign exchange reserves far exceed the safe reserves based on normal needs, which further increases the pressure of RMB appreciation. Holding too much foreign exchange reserves will not only affect the independence of China's monetary policy, but also reduce the efficiency of factor allocation. In particular, the yield of holding US Treasury bonds is far lower than that of foreign investors investing in China (the difference is about 10%), and a lot of profits are earned by foreigners. In this context, raising the value of RMB is conducive to overcoming the distortion of resource allocation.

2. RMB appreciation will not repeat Japan's mistakes.

Some people like to cite the example of Japan to illustrate the adverse consequences of currency appreciation. Some people even politicize this, saying that suppressing the appreciation of the local currency is a conspiracy of Americans to bring down a country's economy. In fact, these are not convincing.

It should be said that the appreciation of the yen is not the chief culprit of the current economic downturn in Japan. The appreciation of the yen began on August 26th, 197 1, and Japan changed from a fixed exchange rate system pegged to the US dollar to a floating exchange rate system. On February 8th of that year, 65438+ According to the Smithsonian Agreement, the yen was changed from 360 yen to 308 yen to kloc-0/dollar. Prior to this, Japan had experienced rapid economic growth from 1955 to 1970, which lasted for 15 years. But after that, from 1970 to 1990, the average annual growth rate of Japan's GDP was still as high as 9.2%. It can be intuitively seen from the following figure that after 1970, the yen continued to appreciate, while Japan's annual GDP growth was relatively stable at around 8%, with the highest year being 2 1.8% and the lowest year being 4. 1%. After 1990, Japan's bubble economy burst and its economic growth rate has been low. This is a very complicated economic phenomenon for many reasons.

On the issue of RMB appreciation, comparing Japanese economy with Japanese economy actually ignores two huge differences between Chinese and Japanese economies. The first is the difference in domestic demand. China is a big country with a population of1300 million, and its domestic market has great potential. Multinational companies investing in China also take a fancy to China's huge market resources. Therefore, after the appreciation of RMB, even if the export is affected to some extent, the shortage of total demand can be made up by developing the domestic market. Japan is a small country with limited domestic demand, especially the Japanese government's long-term policy of protecting the interests of domestic agriculture and small and medium-sized enterprises, which further leads to the lack of strong competitiveness of the overall economy. The second is the factor cost difference. Japan is a typical small resource country. The rapid economic growth has led to a sharp rise in domestic factor prices, the most typical of which is the rapid increase in the average cash income of employees. 1970 The average monthly income of Japanese workers was 76,000 yen, and 1990 rose to 370,000 yen, an increase of 4.9 times. If calculated in US dollars, it has increased by 13.0 times [1], and the rising cost has weakened the competitiveness of Japanese goods. Although China is not rich in natural mineral resources, the labor price will have a strong competitive advantage for a long time.

3. Why is it so difficult for RMB to appreciate?

Since the end of 2002, RMB has been facing obvious appreciation pressure, especially after the central bank raised interest rates in June 5438+ 10, 2004, the appreciation pressure further increased. In fact, during the 1998 Asian financial crisis, the RMB was mainly faced with the pressure of appreciation. It took more than three years from the pressure of RMB appreciation to the beginning of appreciation, which reflected a difficult policy choice for RMB appreciation. There are two main reasons.

First, it is difficult to judge the result of appreciation. Economic operation is a complicated process that is interrelated and influenced each other. For the impact of RMB appreciation, we can only give a general expectation, and it is difficult to make a specific quantitative judgment. But what is certain is that RMB appreciation will "affect the whole body", and in case of uncontrollable situation, it will cause huge economic and political problems. Therefore, the adjustment of RMB exchange rate must be considered comprehensively, coordinated as a whole and handled cautiously. Especially at this stage, a large number of international hot money has entered the country to bet on the appreciation of RMB, while the domestic financial system and capital market are immature, and financial institutions have weak ability to resist risks. In this context, the timing, range and mode of RMB exchange rate adjustment need to be carefully selected, and a little carelessness may cause huge economic fluctuations.

Secondly, the path dependence caused by the long-term undervaluation of RMB exchange rate. The undervaluation of RMB gives the export sector a price advantage, which forms the low exchange rate path dependence of export enterprises. Many export enterprises gain competitive advantages in the international market by low prices, and win a large amount of foreign exchange by "running volume", forming huge vested interests. The appreciation of RMB will almost certainly bring great pressure to export enterprises that rely on low-price competition, and break the pattern of interest distribution, which will inevitably be opposed by vested interest groups. Therefore, the appreciation of RMB must coordinate the interests of all parties and handle many relations well.

Second, the advantages of RMB appreciation outweigh the disadvantages.

The impact of RMB appreciation has both advantages and disadvantages. From a macro and long-term perspective, if macroeconomic policies are handled well, the advantages of RMB appreciation outweigh the disadvantages. At present, the adverse effects of RMB appreciation are mostly short-term and partial, and will not affect the overall economic development.

1, the export volume will not drop significantly.

First of all, the international experience of exchange rate adjustment proves that the view that "exchange rate appreciation will definitely hit exports" has no empirical basis. Both Japan and Germany have experienced significant currency appreciation, but their exports have risen instead of falling (see Figures 4 and 5). After the impact of 197 1 Nixon, the exchange rate of the Japanese yen against the US dollar rose from 360: 1 to 308: 1. After that, the yen gradually appreciated, and 1984 reached 23 1 JPY 1 USD. At the same time, Japan's exports to the United States are on the rise. In terms of Japanese yen, Japan's total exports to the United States in 1985 were 42.9 trillion yen, six times higher than that in 1970, with an average annual growth of 12.7%. The 1970s witnessed the fastest appreciation of the German mark, with the bilateral exchange rate increasing from 3.68 marks in 1970 to 1, and then to 1.73 marks in 1979, with a cumulative appreciation of 1. During this period, Germany's foreign trade exports increased.

Secondly, Zhejiang's export structure, which is dominated by manufactured goods, determines that RMB appreciation will not cause a sharp decline in exports. Export commodities are divided into two categories, one is primary products and the other is finished products. The convergence rate of primary products exported by developing countries is high and the competition in the international market is fierce. After the appreciation of RMB, the export of primary products may be affected and reduced. However, according to the situation in Zhejiang, the export proportion of primary products is decreasing year by year, accounting for only 5. 1% of the total export in 2003, so it has little impact on the overall trade export. The production of industrial manufactured goods has the characteristics of internationalization, which requires a large number of imported raw materials and machinery and equipment. After the appreciation of RMB, the cost of imported raw materials and machinery and equipment will be reduced, which will provide enterprises with a certain price reduction space and ease the price pressure brought about by the appreciation of the people. More importantly, the products of finished products are quite different, and the impact of RMB appreciation on the competitiveness of export products mainly depends on the price relationship with products of relevant countries. Judging from the sharp price reduction competition of China's products in recent years, China's low-level manufactured goods have a huge price advantage compared with other countries. Even if the price is slightly raised due to the appreciation of RMB, it will not necessarily be higher than that of other countries and regions, which will not greatly affect the export competitiveness of China products.

Thirdly, low labor costs put export enterprises under certain appreciation pressure. Zhejiang is a model of labor-intensive product production in China. The international competitiveness supported by low wages is much higher than the national average. Low labor costs have become the main support for Zhejiang products to have obvious price advantages in the world market. According to the calculation in the Trade and Development Report in 2002, among 17 important sample countries, China has the lowest unit labor wage, and the wage in the United States is 50 times that of China. Low labor costs will not be completely offset by the increase in export prices. After the appreciation of RMB, if the magnitude is not great, the labor cost still has obvious comparative advantage. Low labor costs enable export enterprises to adopt price reduction strategies to alleviate the pressure brought by RMB appreciation, and exports will not be greatly reduced because of RMB appreciation.

Finally, the exchange rate is not the main factor affecting exports, but the improvement of industrial labor productivity is the key to the rapid growth of exports. Historically, since 1994, the real exchange rate of RMB has been appreciating, but China's exports have maintained a rapid growth momentum. From 1994 to 2002, the nominal exchange rate of RMB against US dollar, Euro (before 200 1 it was German mark) and Japanese yen appreciated by 5. 1%, 17% and17% respectively, while the real exchange rate appreciated by/ The annual growth rates of Zhejiang's exports to Germany and Japan are 23.9%, 20.7% and 14.7% respectively. This shows that exchange rate is not the key to export, but the improvement of labor productivity is the core factor. Since 1990s, the labor productivity of China's export sector has maintained a growth rate of 1.5-2 times that of the United States, and Zhejiang is higher than the national average. As long as the rapid improvement of labor productivity is maintained, the export volume will naturally increase.

2. Foreign direct investment will not decline on a large scale.

1994 to 2003, our province attracted a total of 29 billion US dollars of foreign direct investment, with an average annual growth rate of 37.2%. Foreign-funded enterprises have become an important driving force to promote economic growth and solve employment problems in our province, and also an important way to introduce foreign advanced production technology. After the appreciation of RMB, foreign direct investment will not drop sharply, because there are three main reasons for foreign-funded enterprises to invest in China:

First, we are optimistic about the big market with a population of 65.438+0.3 billion. It is impossible to find a second such a huge potential market in the world. Fierce market competition has led a large number of foreign companies to enter China and seek new profit growth points. Master Kong Group in Taiwan Province Province was just a little-known company before it entered the mainland market. After it entered the mainland of China, the huge mainland market made it rapidly grow into the largest Taiwan-funded food enterprise in China, and won the reputation of "king of China noodles".

Second, make full use of China's cheap labor resources. The wage level of China's labor force is quite low. Measured by the nominal wage level of manufacturing industry in China 1.50, Japan 1.30 and even developing countries like Malaysia and the Philippines 1.4 ~ 1.5. There is also an important factor here, that is, the long-term intensive agricultural management has brought up the excellent quality of China farmers who are particularly good at suffering, as well as the dexterity of thinking and body.

The third is the attraction of similar cultural traditions. Among the foreign-funded enterprises in Zhejiang, Hong Kong-funded and Taiwan-funded enterprises account for about half. Mainland China and Hong Kong and Taiwan share the same language and cultural traditions, and a high sense of cultural identity is an important reason for these enterprises to invest in China. A small appreciation of the renminbi will not have a significant impact on the introduction of such foreign capital.

These three leading factors of the rapid growth of foreign capital have obvious long-term characteristics, so foreign direct investment will not be quickly reversed because of the rise of the external price level of RMB. Under the specific background of SARS in 2003, our province has still made considerable achievements in utilizing foreign capital, which can prove this point.

3. There will be no mass unemployment.

Employment is not only an economic issue, but also an important social and political issue. Many people are worried that the appreciation of the renminbi will seriously affect the total demand, thus causing large-scale unemployment and affecting social stability. This kind of worry is unreasonable.

Exchange rate adjustment mainly affects employment through two channels. First, the appreciation of the renminbi will cause changes in the relative prices of imports and exports, thus affecting exports and ultimately employment; Second, the appreciation of RMB will affect foreign direct investment, and then affect investment in fixed assets, and then affect the employment situation. According to the previous analysis, after the appreciation of RMB, there will be no fundamental reversal of enterprise exports and foreign direct investment, so there will be no significant fluctuations in employment.

Moreover, domestic demand in China has been very strong since 2002. At the beginning of 2003, the central bank began to use open market operations to withdraw money. After July, it adopted some monetary policies to strengthen the control of domestic loans. So far, domestic demand still tends to expand automatically. After the appreciation of RMB, as long as domestic demand keeps steady growth, it can offset the impact of appreciation on external demand and maintain the stability of total demand. With the steady growth of total demand, employment may fluctuate slightly after RMB appreciation, but it is unlikely to cause large-scale unemployment.

Three, the six major impacts of RMB appreciation on Zhejiang

The appreciation of RMB is a new opportunity for the economic development of our province, which is conducive to adjusting and optimizing the industrial structure and changing the mode of economic growth. Although the exchange rate adjustment only appreciated by 2%, it was changed to "refer to a basket of currencies", which means that the exchange rate formation mechanism has taken a solid step towards marketization. Zhejiang has a higher degree of marketization, and the market players are more mature and rational. It is easier to grasp the price signal expressed by exchange rate changes, allocate resources reasonably and effectively, and improve the efficiency of economic development.

(1) It is conducive to making better use of overseas resources.

The appreciation of the renminbi is conducive to increasing the welfare of residents. In 2003, the per capita disposable income of urban residents in our province was 1.3 1 10,000 yuan, and the RMB appreciated by 2%, which was equivalent to an increase of 262 yuan in the purchasing power of American goods for everyone. This can expand residents' purchase of imported goods from abroad and reduce the cost of studying abroad and traveling.

The appreciation of RMB is beneficial to the utilization of foreign resources. The restriction of resources, technology and other factors will be a long-term problem for Zhejiang's economy. In recent years, Zhejiang's imports of basic resources such as iron ore and crude oil have grown rapidly, increasing by 325% and 140% respectively in 2004 compared with 2003. The appreciation of RMB and the reduction of import cost are good news for Zhejiang. According to the statistics of Hangzhou Customs, Zhejiang imported 146 1 billion dollars in the first half of this year, and the appreciation of RMB exchange rate can save 2.34 billion dollars.

The appreciation of RMB is conducive to the use of foreign advanced knowledge. With the appreciation of RMB and the improvement of purchasing power, domestic enterprises can increase the direct purchase of overseas patents, technologies and equipment at a lower cost, and increase the dispatch of management and technical personnel to study abroad. Huzhou Jiuli Special Steel Co., Ltd. recently signed a contract to import a hot extrusion machine with a single machine pressure ranking ninth in the world, with a value of 9.75 million euros. After RMB appreciates by 2%, enterprises will pay 2.25 million yuan less.

(2) Accelerate the flow of labor to the tertiary industry.

After the appreciation of RMB, the import cost of enterprises is reduced, forming a situation of expanding the import of high-tech products such as machinery and equipment; At the same time, for export enterprises, the appreciation of RMB means a relative increase in labor costs, so there will be a situation in which domestic labor is replaced by overseas capital goods, that is, enterprises expand the import of machinery and equipment and use the high efficiency of new technologies to reduce the employment of enterprise workers. From this perspective, the appreciation of RMB will cause a certain number of people to lose their jobs.

However, this process will accelerate the improvement of the overall production efficiency of the manufacturing industry, increase the wage income of manufacturing workers, and thus improve their consumption power, which provides a good opportunity for the development of the tertiary industry represented by the service industry. In this way, the employed population replaced by high technology will be absorbed by the tertiary industry, forming an accelerated transfer of labor to the tertiary industry, thus making the service industry play an increasingly prominent role in absorbing the employed population, which is also in line with the development experience of developed countries.

(C) conducive to changing the mode of economic growth

First of all, the appreciation of RMB can accelerate the adjustment of industrial structure. After the appreciation of RMB, the export of low value-added products will be restrained, and the profit margin of enterprises will be reduced. In order to survive in the competition, enterprises have to change the competition mode. On the one hand, they will pay more attention to the domestic market instead of blindly pursuing exports and become the workshops of multinational companies. On the other hand, efforts to change the export structure and increase the proportion of high value-added products will force enterprises to improve their scientific and technological level and form pressure to accelerate the transformation of industrial structure. In addition, after the appreciation of the people, the import cost is reduced, and enterprises can make better use of overseas knowledge, technology and advanced equipment, thus reducing the cost of industrial restructuring.

Secondly, the appreciation of the renminbi is conducive to changing the mode of economic growth. With the rapid development of Zhejiang's economy, the pressure of environment and resources is increasing, almost reaching the limit. The unit energy consumption of Zhejiang's main products is more than 30% higher than that of developed countries, and the energy utilization efficiency is lower than that of developed countries by more than 10 percentage point. In 2003, per capita energy consumption and per capita annual electricity consumption increased by 23% and 100% respectively compared with the end of the Ninth Five-Year Plan. Some export products depend on high energy consumption and high pollution, which is the product of environmental pressure passed on by foreign countries. Appropriate appreciation of RMB will reduce the import cost of high-tech equipment with low energy consumption and high environmental protection, increase the import quantity, effectively reduce resource waste and reduce environmental pressure. In addition, through the effect of "survival of the fittest", some export enterprises with high energy consumption and low added value of products can be eliminated, the phenomenon of auctioning our precious resources to the world at low prices can be gradually changed, and the transformation of economic growth mode can be accelerated.

(4) It is conducive to reducing trade frictions and improving the trade environment.

Zhejiang's export commodities are mainly labor-intensive and lack of core technology, accounting for more than 80% of the total export. The added value of export products is low, mainly relying on low prices to participate in international market competition, and trade friction is inevitable. From 2002 to 2004, Zhejiang * * * encountered 7/kloc-0 cases of "anti-dumping and anti-safeguard" and "337 investigation" from abroad, involving 2,496 enterprises, involving 654,380.5 billion US dollars, accounting for 45%, 50% and 60% of the country respectively. Zhejiang has become the country that has suffered the most anti-dumping and safeguard measures.

In the short term, after the appreciation of RMB, the export price of products will increase. However, because the export price of our province is already very low, even if the price is raised appropriately, the products still have strong competitiveness, which will help reduce the lawsuits filed by other countries against China's low-priced dumped products. Some export products of Zhejiang occupy a high share in the international market. If we take advantage of this market and raise the price of our products appropriately, we may increase our profits. The appreciation of RMB also shows China's attitude towards exchange rate reform to the world, and countries such as Europe and America will inevitably adjust their trade policies with China and reduce the number of various trade frictions.

In the long run, although the RMB exchange rate adjustment is only 2%, it shows that the RMB is returning to the real exchange rate. For enterprises, this means that we must adjust the low-price competition strategy in the future, in order to win in improving quality, style, function and after-sales service, improve our position in the international division of labor and value chain, increase the added value of products, and gradually bring export trade into the benign track of sustainable development. And this is obviously conducive to reducing trade friction.

(five) is conducive to accelerating the process of enterprises in our province to the world.

Zhejiang province has a developed private economy and abundant private capital, which has the typical characteristics of "storing wealth for the people" In 2003, the province's deposit balance reached 654.38+047.58 billion yuan, with an average annual increase of 27.8%. However, due to the imperfect economic and financial structure, the transmission mechanism of saving into investment is blocked, and a large number of surplus capital is looking for profit opportunities. In the downturn of the stock market, capital has flocked to the real estate market, and the "Wenzhou real estate speculators" active all over the country is an obvious example. In this sense, our province is not short of investment funds, but investment opportunities.

After the appreciation of RMB, you can buy more foreign resources with less money, which will stimulate enterprises to develop foreign investment and implement transnational operations, so that you can make better use of the international market without worrying about the sanctions of trade barriers. Looking at the development process of foreign multinational companies, the low-level stage is pure product export, and the high-level stage is direct investment and localized production. Zhejiang enterprises must go through this process if they want to go out first. RMB appreciation will accelerate the realization of this process.

(VI) Some adverse effects of RMB appreciation

Zhejiang's economy has obvious export-oriented characteristics. In 2004, Zhejiang's total foreign trade amounted to US$ 85.23 billion, and its dependence on foreign trade was as high as 66% and that on exports was as high as 43%. For Zhejiang, a big exporting province, the appreciation of RMB will also bring some adverse effects.

-crack down on export enterprises. It has the greatest impact on low value-added products such as textiles. There are many small textile enterprises in Zhejiang, the export value of which is below $2 million, and the profit of textile industry is generally below 10%, while the profit of these small enterprises is only about 3%, which is a great blow to enterprises.

-Affecting foreign direct investment. The appreciation of RMB will reduce the value of equivalent foreign currency converted into RMB, reduce the profits of foreign investors, and naturally slow down investment.

-affecting employment. The export enterprises in our province are mainly labor-intensive enterprises. With the appreciation of RMB, the profits of export enterprises will decline, and enterprises are likely to pass on the losses caused by the appreciation of RMB by reducing the wages of workers and reducing the number of workers. This will have a certain impact on employment.

-The income gap has widened. After the appreciation of the renminbi, the income expressed in dollars increased. However, only middle-and high-income groups who can buy imported high-end products can truly enjoy the benefits of appreciation. In addition, after the appreciation of the RMB, the Shanghai and Shenzhen stock markets rose, benefiting middle-and high-income groups with investment ability. Due to the appreciation of RMB, the income gap will widen.

Fourth, actively grasp the characteristics of the new development stage formed by RMB appreciation and accelerate the transformation of economic growth mode.

Whether Japan, South Korea or Germany, the appreciation of their currencies will push their economies into a new stage of development. Japan's experience shows that a country's economy and society will have a rapid development period of at least 20 years after the local currency enters the process of appreciation. The appreciation of RMB also marks that China's economy has entered a new stage of development, which has five important characteristics.

First, the level of marketization will be further improved, and the market will play a greater fundamental role in resource allocation; Second, China's economic competitiveness has risen and its voice in the global economy has been strengthened; Third, the low-price advantage of goods and services began to weaken, forming pressure to promote industrial restructuring and change the mode of economic growth; Fourth, China's economy will further integrate with the global economy, at least in terms of trade and commodity prices, gradually forming a pattern of internal and external economic integration; Fifth, the floating exchange rate system leads to an increase in the uncertainty of the market environment, but as long as macro-control is carried out flexibly, it will help to activate positive factors within the economy and society and enhance the sensitivity of rational allocation of factors.

It is our important historical mission to fully grasp some important characteristics of the new development stage of RMB appreciation and accelerate the transformation of Zhejiang's economic growth mode. As far as the government is concerned, it should take the appreciation of RMB as an opportunity to further accelerate the market-oriented reform and accelerate the transformation of economic growth mode. As far as enterprises are concerned, they can use various financial means to avoid exchange rate risks in the short term, and they can also pass the burden on to dealers to reduce the loss of RMB appreciation. In the long run, they should turn pressure into motivation, speed up technological progress, speed up product structure adjustment and improve the core competitiveness of enterprises.

1. Accelerate market-oriented reform, seize the opportunity of exchange rate changes, and optimize the resource allocation mechanism. Exchange rate is not only a policy tool, but also a price. As a kind of price, exchange rate should be determined by the market in a market economy; As a policy tool, adjusting the exchange rate will affect the economic behavior of market participants. Therefore, whether exchange rate changes can play an effective regulatory role depends on whether the market mechanism is perfect and whether market participants can make timely and sensitive responses to exchange rate adjustments. Zhejiang's private economy is developed with a high degree of marketization. At present, we should take property right reform as the starting point, accelerate the transformation from primary market economy to modern market economy, and improve the marketization level of resource allocation. Only when the market system is perfect, market competitors can accurately grasp the domestic and foreign price information transmitted by exchange rate, correctly compare costs and profits internationally, import and export trade can be truly based on comparative interests, and the competitiveness of enterprises can be maximized. At present, it is necessary to speed up the process of factor marketization, such as reducing the government's administrative intervention in the transfer of industrial land and increasing the proportion of industrial land bidding, auction and hanging; Accelerate the pace of government reform, provide more low-cost public goods with more innovative governments, and promote the good operation of the national economy and society; Accelerate the improvement of the level of integrity, strengthen government supervision, and maintain and optimize the market economic order.

2. Implement the import strategy and increase the utilization of overseas advanced knowledge and other resources. The appreciation of RMB brings export pressure to enterprises in our province, but it also reduces the cost of using advanced overseas knowledge and other resources in our province, which is a great strategic opportunity for Zhejiang, which is constrained by both natural mineral resources and lack of knowledge. Therefore, starting from the strategic height of "leveraging" development and opening up to promote development, we should study and implement the import strategy, accelerate the introduction of advanced overseas knowledge and actively use overseas mineral resources, just like grasping exports. It is necessary to study systematically, increase training for studying abroad, introduce patents and technical equipment, purchase advanced commodities, and purchase energy and raw materials. By using overseas advanced knowledge and purchasing mineral resources, we can optimize the import structure, make good use of Zhejiang's huge foreign exchange, speed up the improvement of Zhejiang's economic and social knowledge level, ease Zhejiang's resource constraints, get out of the path lock of industrial structure and change the mode of economic growth.

3. Strengthen the construction of intermediary organizations such as trade associations, and pass on the rising cost factors to dealers. Transferring costs to overseas distributors is an important strategy for exporters to ease the pressure of RMB appreciation costs. However, the strength of a single enterprise is weak, and it needs to be led by non-governmental industry organizations under the guidance of the government to improve the price negotiation ability with overseas distributors step by step. Trade associations should also seize this opportunity and give full play to their role. As a matter of fact, the export products of some enterprises in our province have a high share in the international market, and we have strong negotiation ability on price, so we can ask our customers to share the profit loss caused by RMB appreciation. For example, in the export contract signed between Shaoxing Hao Na Textile Trading Co., Ltd. and a foreign merchant in Saudi Arabia, the unit price of 1.5m (length 1m) of "Jetta Chemical Fiber Fabric" increased by 3 cents, or 4.3%, which can effectively share the rising cost pressure brought by RMB appreciation with the dealers.

4. Enhance the core competitiveness and change the export structure of foreign trade. It is impossible for enterprises to rely on the protection of external policies such as exchange rate and interest rate for a long time to achieve development. We must rely on scientific and technological progress and improve labor productivity to enhance the internal competitiveness of products and realize the transformation and development of enterprises. Taking the appreciation of RMB as an opportunity, enterprises should arrange import plans reasonably, increase the import of advanced technology and high-tech products, and improve the scientific and technological level of enterprises. Enhance the connotation of enterprise brand and build the international advantage of brand. Carry out resource integration and product structure adjustment, implement diversification strategy, improve product quality and grade, adjust product structure, increase product added value, and realize the transformation from product output to brand output and capital output.

5. Strengthen the long-term study of RMB exchange rate. The influence of RMB exchange rate adjustment on Zhejiang economy is various, and our institute will further investigate and study it in the future. I also hope that the relevant departments can attach great importance to this issue, organize scientific research forces in the province, conduct regular discussions, and thoroughly study Zhejiang's economic countermeasures under the trend of RMB appreciation.