The Central Economic Work Conference pointed out that it is necessary to make greater efforts to promote the stable scale and excellent structure of foreign trade, make greater efforts to promote the stable stock and expansion of foreign investment, and cultivate new growth points of international economic and trade cooperation.
The data shows that in 2022, the total import and export value of China’s goods trade was 42.07 trillion yuan, an increase of 7.7% over 2021. The steady growth of foreign trade is inseparable from financial escort. Relevant departments and financial institutions have taken various measures to promote the stability and quality of foreign trade and help foreign trade achieve high-quality development.
The implementation of policy measures will be detailed, and the basic foreign trade will be stabilized.
Chengdu International Railway Port in Sichuan, China-Europe trains loaded with electronic products, mechanical parts, daily necessities and other goods set off for the distance.
China Europe Train (Chengdu) is operated by Chengdu International Railway Train Co., Ltd. "We provide this company with efficient cross-border transaction services, and control the time for its remittance to reach the overseas beneficiary’s account within a few hours, which improves the efficiency of cross-border capital turnover." The relevant person in charge of Chengdu Bank said.
The access to high-quality financial services by enterprises related to China-Europe trains is a microcosm of financial assistance to stabilize the basic foreign trade.
Affected by the complicated and severe international environment and the impact of epidemic situation, the difficulties and challenges faced by China’s foreign trade enterprises in production and operation have increased. Since 2022, a series of policies and measures to stabilize foreign trade have been introduced one after another: the People’s Bank of China and the State Administration of Foreign Exchange have issued 23 financial policies to help enterprises out, many of which involve stabilizing foreign trade; The General Office of the State Council issued the Opinions on Promoting the Stability and Quality of Foreign Trade, and proposed measures such as increasing import and export credit support and further strengthening financial support for small and medium-sized micro-foreign trade enterprises; The Ministry of Commerce issued "Several Policies and Measures to Support the Stable Development of Foreign Trade", proposing "to study and optimize the underwriting conditions of medium and long-term insurance and increase the support of export credit insurance"; The Ministry of Commerce and the People’s Bank of China issued a notice to create a good environment for the cross-border use of RMB …
The implementation of policies and measures has been detailed and achieved good results.
Reduce financing costs. In 2022, the weighted average interest rate of new corporate loans was 4.17%, 34 basis points lower than the previous year, and the problem of expensive corporate financing continued to be alleviated.
Promote the facilitation of trade balance. Relevant departments have promoted the facilitation policy of foreign exchange receipts and payments of high-quality enterprises to the whole country. By the end of September 2022, the policy had involved nearly 1.5 million businesses, with a scale of nearly 900 billion US dollars.
Improve the exchange rate risk management ability of enterprises. From January to August, 2022, the scale of foreign exchange derivatives such as forwards and options used by enterprises to manage exchange rate risk increased by 27.6% year-on-year, and the hedging ratio of enterprises increased by 3.8 percentage points to 25.4% compared with 2021, and the awareness and ability of exchange rate risk management of enterprises continued to increase.
"A series of financial policies to stabilize foreign trade have helped foreign trade enterprises solve problems, and foreign trade has shown strong development resilience and vitality, making positive contributions to stabilizing the macroeconomic market." Zhou Maohua, a macro researcher at the financial market department of China Everbright Bank, said.
Continue to increase credit supply and provide risk protection.
Stabilizing foreign trade is related to the overall economic situation. Financial institutions continue to increase credit supply and provide risk protection, which has added confidence and confidence to the development of foreign trade enterprises.
To provide global linkage financing support and meet the differentiated financing needs of small and micro foreign trade enterprises, a number of financial institutions continued to increase credit support in the foreign trade field. The data shows that in the first three quarters of 2022, ICBC issued more than 1.2 trillion yuan of off-balance-sheet financing for key foreign trade and foreign-funded enterprises at home and abroad; In the first 11 months of 2022, the amount of cross-border trade financing invested by Bank of Communications was 209.7 billion yuan, an increase of 8% over the same period in 2021.
For foreign trade enterprises, export credit insurance plays an outstanding role in enhancing credit guarantee. The products of Zhejiang Huazhijie Plastic Building Materials Co., Ltd. are very popular in the international market. "The problem of’ we can’t take orders’ has been solved," said the relevant person in charge of the company. Thanks to the policy support, the export credit insurance quota of enterprises has increased, and "it is more reassuring to do export business".
Relevant departments continue to introduce policies to promote export credit insurance institutions to further optimize underwriting and claim settlement conditions and expand service coverage for foreign trade enterprises, especially small and medium-sized enterprises. The data shows that in the first 11 months of 2022, China Xinbao increased its support for the real economy and gave full play to the role of policy-based export credit insurance, with a total underwriting amount of US$ 817.93 billion, up 8.6% year-on-year.
"Export credit insurance services help to ensure the safety of foreign exchange collection by foreign trade enterprises, reduce transaction costs, enhance the competitiveness of foreign trade enterprises and expand the scale of trade." Wang Xiangnan, deputy director of the Insurance and Economic Development Research Center of China Academy of Social Sciences, suggested that in 2023, insurance institutions should further improve the efficiency of insurance and claim settlement, and give enterprises certain preferential rates to help foreign trade enterprises go into battle lightly. In addition, insurance institutions can also rely on professional advantages and information resources to help foreign trade enterprises judge potential market risks.
Support new foreign trade formats and innovate financial products and services.
Shandong Electric Power Construction Third Engineering Co., Ltd. has a number of contracted construction businesses along the "Belt and Road". "This company is going to sign equipment purchase contracts with German enterprises for power station projects contracted in South Africa, and settle by letter of credit." The relevant person in charge of Bank of Communications Qingdao Branch introduced that by simplifying business audit documents and implementing electronic services, it saved business processing time and improved the efficiency of fund settlement for enterprises.
The vigorous development of new foreign trade formats and new models such as cross-border e-commerce, overseas warehouse and market procurement trade has injected new kinetic energy into China’s foreign trade development, and at the same time put forward higher requirements for financial products and services. How to meet the needs of new foreign trade formats?
Broaden the settlement channels. The new foreign trade format is developing rapidly, and the efficiency of capital turnover will directly affect the business growth of enterprises. The foreign exchange bureau actively supports qualified banks and payment institutions to provide more convenient settlement channels for market entities such as cross-border e-commerce by trading electronic information. By the end of September 2022, the annual business volume of foreign exchange settlement in new trade formats exceeded 1.9 billion.
Innovative financial products and services. In 2022, the transaction volume of BOC’s new foreign trade settlement business exceeded 280 billion yuan, an increase of about 85%. "Financial institutions should adapt to the characteristics of scattered market entities in new foreign trade formats and numerous small and micro enterprises, continuously increase digital construction and application of new technologies, and provide universal and safe online financial services on the basis of meeting the authenticity of transactions." Wang Xiao, general manager of the transaction banking department of Bank of China, said that the small-scale and high-frequency business characteristics of the new foreign trade format gave birth to the demand for personalized financial services, which required financial institutions to continuously strengthen the innovation of settlement and financing products.
Enhance the risk management ability of foreign trade enterprises. Recently, under the guidance of Guangzhou Municipal Bureau of Commerce, the country’s first single e-commerce complaint insurance landed in Ping An Property & Casualty Guangdong Branch, effectively reducing the cost of rights protection for cross-border e-commerce enterprises and helping enterprises improve their compliance management level; China Xinbao underwrites overseas warehouse business with medium and long-term export credit insurance for the first time, alleviating the logistics pressure of foreign trade enterprises in peak season …
"The new foreign trade format and new model is an important force for China’s foreign trade development. Through a number of policy support from the financial industry, promoting the development of new foreign trade formats and new models is conducive to promoting the high-quality development of foreign trade and cultivating new advantages in participating in international economic cooperation and competition. " Zhou Maohua said.