Rmb Effective Exchange Rate And Labor Supply Impact On The Export Of Processing Trade

From1978China government has carry out the policy of reformation and opening china has made a gigantic achievement with over30year. Great changes have taken place in the whole society as well as very person in the society. When we looked into the main reason of miracle which china has achieved we found that china’s success is origin from the global trend outside china and thumbed a lift of globalization. The increase of Export volume spherically the processed trade volume is the best example of china thumbed a lift of globalization. In recent yeas the process trade Export of china has met some obstacle. The statistics shows that the proportion of total amount of process trade in the whole trade of china as a whole has altered a significant change. The proportion first has rise from5.9%to53.4%between the beginnings of1980’s and1998then decrease to38.95%in the year of2010. We need to study carefully for what factors contribute to great success of china’s process trade Export while China’s Export volume becomes the first among the world. China should adjust them to achieve the steady development of process trade Export.This paper has analyses the impact of RMB rear exchange rate and Labor supply on china process trade Export under the micro level. We collected the data of process trade Export volume, RMB rear exchange rate (World Bank data) and Labor quantity of FDI enterprise from china’s reform and openness policy has been adopted. The regression analysis method of Econometrics and EVIEW5.0software will be adopted to the empirical study.to understand the impact of long-term fluctuate trend of rmb rear exchange rate and Labor supply on the proportion of process trade Export volume among china Export volume as a whole is very important. It can help us not only to grasp the essence of china’s exchange rate issue but also to understand the situation of Labor supply at present and acted as a reference for government who can adjust the policy. The most important of all it can help us to find a right way to guarantee the health development of process trade and supply the basis for the upgrade of china’s process trade. Thus make the process trade healthy and guarantee the steady development of Chinese economy.Due to the appreciation of rmb and increasingly insufficient of Labor supply we have to upgrade the production efficiency and increase the input on Labor training and education as to solve the negative impact which caused by appreciation and insufficient Labor supply. Innovation of science and upgrade of technology is the effective way to raise the productivity which we can see that science and technology has been taken as the key factor to keep the steady and sustainable development of China from the government long-term development schedule. As a result the right policy guide and support to Export oriented enterprise is urgent issue. For example to offer tax favorable term and low-interest loan to small Labor intensive and Export oriented enterprise who want to import high-tec equipment form foreign market. Encourage the small size Export enterprise to invest research and development of technology and give them support so as to increase the productivity. Help the Export enterprise to upgrade technology can relieve the pressure of increasingly deficit Labor supply and rmb appreciation.