Processing Trade Enterprises In China Foreign Exchange Risk Management Issues Discussed

Processing trade enterprises are the most important part of foreign trade enterprises, whose occupation ratio of import and export amount is 45.4% in total foreign trade in 2008. After the reform of RMB exchange rate system in 2005, the first risk that processing trade enterprise met is the growth RMB exchange rate. From 2005 to 2009, the great change of RMB exchange rate and market environment weakened ability of resisting exchange rate risk. In this period, processing trade enterprise began to Foreign Exchange Risk Management according to the change of the external environment and internal operation characteristics. Due to external factors and internal system, processing trade enterprises made mistakes in strategy and lost ability in the development of Foreign Exchange Risk Management.Now there are not a lot of articles in research of Foreign Exchange Risk Management about processing trade enterprises. This article is to discuss new problems that processing trade enterprises, especially for charging processing trade enterprises, faced in Foreign Exchange Risk Management, reasons and solution on the basis of the growth RMB exchange rate from the reform of RMB exchange rate system in 2005.Firstly, this article makes brief analysis of basic theory of Foreign Exchange Risk Management and mainly introduce foreign exchange risk recognition, measurement theory according to the characteristics of processing trade, and make detailed analysis of three kinds of foreign exchange risk management methods of the processing trade enterprise.Secondly, this article analyses the status, main mode and development stage of processing trade and processing trade enterprise, and makes brief analysis of two main operation mode and foreign exchange risk in the change of system of foreign exchange risk. This article makes selective analysis of influence of the exchange rate risk after the reform of RMB exchange rate system in 2005. This article indicates process enterprises are urgent to develop foreign exchange risk management as the foreign exchange risk they faced is unprecedented complex.Thirdly, this article analyses the new change of foreign exchange and management that processing trade enterprises are facing on the basis of above mentioned, and put forward new problems with new changes of wrong strategy and lack of ability in foreign exchange risk management. The article analyses reasons of new problem that business strategy and management system face by the means of theory and data. Fourthly, this article introduces and analyses the choice and effect of strategy of foreign exchange risk management based on the case of present situation of R company which is a processing trade enterprise, and put forward processing suggestion.Finally, this article indicates solution of by combining economic risk management and business strategy, establishing system of foreign exchange risk recognition, evaluation and reaction, hopes to provide enlightenment for Chinese processing trade enterprise and management department...