General

The ever-changing external situation poses an increasing risk of uncertainty due to fluctuations in foreign exchange rates. The branch vigorously promotes exchange rate derivative business, helps enterprises establish the concept of "risk neutrality", builds a "safe haven" for foreign trade enterprises, and braves the storms together with enterprises, ensuring the stable "going out" of international trade enterprises.

What is the "risk neutral" concept of exchange rates? In short, enterprises should realize that foreign exchange fluctuations are two-way, help international trade enterprises strengthen foreign exchange management, minimize the negative impact of exchange rate fluctuations, and improve financial robustness.

PT Plastic Import and Export Company is mainly engaged in the import and domestic sales of plastic raw materials, with an annual import volume exceeding 10 million US dollars. Due to the fact that the sales prices of downstream customers are often predetermined, enterprises not only have to bear the risk of fluctuations in imported raw material prices, but also the risk of losses caused by forward exchange rate fluctuations.

Recently, PT Company imported a batch of plastic materials worth $1 million from overseas suppliers and agreed to make payment in three months. But unexpectedly, three months later, the RMB depreciated, and the exchange rate at the time of payment decreased by 1.5% compared to when the contract was signed, resulting in the enterprise spending an additional 100000 RMB to purchase foreign exchange for external payments.

Regarding the rise and fall of exchange rates, most companies used to have a 'gambling' mentality and did not incorporate exchange rate fluctuations into their daily financial decisions, "said Zhou Rui, the head of PT Company, referring to his previous' gaming 'mentality." Fortunately, later on, China Construction Bank came to our doorstep and brought us the concept of' risk neutrality '

The branch has visited enterprises multiple times to design personalized exchange rate hedging schemes for PT Company, such as forward settlement and sales of foreign exchange, interest rate options, etc., and agreed on future settlement and purchase prices with enterprises to dispel their concerns about exchange rates.

Nowadays, more and more Dongguan international trade enterprises choose to build foreign exchange "safe havens" by stopping at their branches.

Due to concerns about significant exchange rate fluctuations during the Dragon Boat Festival holiday, WG Company, a "specialized, refined, and innovative" enterprise, recently attempted to handle a 21 day forward foreign exchange purchase, locking in the cost of import purchase and payment, and planning profit and income in advance. After experiencing the sweetness of exchange rate hedging for the first time, the company subsequently processed two forward foreign exchange purchases within a month. With the professional support of the branch, WG Company improved its internal exchange rate risk management system and built a long-term mechanism to resist exchange rate fluctuations.

When it comes to the foreign exchange risks experienced by the company, Tang Guoqiang, the head of WG Enterprise, repeatedly said three "not easy" things, but his expression clearly reveals his confidence in taking the initiative in the future.

When the sea is stormy, a few stars will sail back into the bay and embrace the warmth. The small harbor has propped up a clear sky for sailboats, waiting for them to carry their dreams before setting off.

With the recent joint launch of the "Jianyue · Yindanhui" product by the Department of Commerce of Guangdong Province, Guangdong Administration of Foreign Exchange, Guangdong Branch, China Export and Credit Insurance Guangdong Branch, and Guangdong Yuecai Financing Guarantee Group, the branch has taken on the role of a major bank and actively helped to enhance the awareness and ability of Dongguan international trade enterprises in exchange rate hedging, writing a new chapter in serving small and micro enterprises in exchange rate hedging.

In the past three years, the branch has accumulated nearly 300 million yuan in foreign exchange losses for Dongguan foreign trade enterprises, providing them with tangible benefits and actively guiding them to shift their focus from foreign trade to both domestic and foreign trade, helping to promote the healthy development of international trade.