The Influence Mechanism Of Rmb Exchange Rate Fluctuation On The Upgrading Of Export Industry Structure

Industrial structure adjustment,optimization and upgrading are important ways and main content for China to accelerate the transformation of economic development methods,optimize economic structure,and achieve high-quality,connotative and sustainable development of the national economy in the new era.Under the background of the "Belt and Road" initiative,the optimization and upgrading of export industrial structure become the key to upgrading China's overall industrial structure,to China's becoming an economic development model for the world and to China's being a new engine for global economic development.China has to coordinate both the international and domestic market,optimize the allocation of resources related,and continuously improve the industry's independent innovation capabilities.In addition,China also needs to speed up the market-based allocation of factors of production and globalization,deepen open cooperation,and accelerate the optimization,transformation and upgrading of export industrial structure.Historically,since reform and opening-up,the scope of China's export industrial structure optimization and adjustment have been significantly wider,the speed of which has been significantly increased.Focusing on the current supplyside structural reform of the real economy structure-the five priority tasks of cutting over capacity,reducing excess inventory,deleveraging,lowering costs,and strengthening areas of weakness,there is a need to accelerate the advancement process from the prospects of export industries,export enterprises,and products.Especially for the export industry,we currently have problems such as weak selfdependent innovation,low-end export overcapacity,high competition in competitive production capacity while low competitive ability to participate,low added value of export products,inadequate high-end export industrial chain,and insufficient share in the high-end global export industrial value chain.Therefore,in the process of the new round of reshaping global industrial value chain,China needs to elevate itself to a higher level in the global industrial chain,and as one of the main driving forces for industrial structure upgrade,the export industry structure needs to be advanced.Under the background of the "Belt and Road" initiative,China's entire industrial chain is in urgent need of transforming from the traditional low-added-value trade chain segment of production to the highadded-value self-dependent intellectual property right segment,improving the profit margins of export products and enhancing export competitiveness.Looking to the future,General Secretary Xi Jinping has already pointed out that industrial structure transformation,adjustment,optimization,and upgrading are the key measures to improve the comprehensive competitiveness of China's national economy.To accelerate the transformation and upgrading of traditional industries,especially export industries,eliminate outdated industrial capacity,make domestic competitive industries going global,further promote the integration of advanced information technology and industrialization,focus on fostering strategic emerging export industries,actively develop modern service industries,cultivate new export industrial formats and new business models,and construct modern knowledge industries development system in consideration of export development.As the “Belt and Road” initiative promotes and the advanced pace of the multi-dimensional integration of China and the global economy,the international and domestic markets are getting closer and closer.Especially with the deepening of the role in international industrial division and the reshaping of the pattern,the reshaping or changing of the new pattern of international trade and investment caused by the economic globalization,the impact on the adjustment and upgrading of China's export and overall industrial structure will become more and more obvious.We know that when the real exchange rate changes,the relative prices of tradable and non-tradable goods denominated in a foreign currency will inevitably change,which will lead to the change in the scale of trade and the structure of imports and exports.The structural change will ultimately guide the overall change of the export industry structure.Therefore,the exchange rate is the most important economic variable to communicate among markets of various countries.Under the general implementation of the floating exchange rate system,the impact and role of the exchange rate on the optimization and upgrading of the export industry structure of various countries has become increasingly important.From the existing research,the flexible exchange rate formation mechanism will promote enterprises to use market price to promote the optimization and upgrading of export industrial structure,gradually improve the export industrial structure and trade structure optimization,and make their profit growth mode more reasonable.In the reality of globalization & anti-globalization and the reshaping global industrial value chain,the role of export industrial chain is getting more and more important in the development and support of a country among the global economy.As far as China involved in the “Belt and Road” process and a new round of global economic structural adjustment,the frequent interaction between China and the global economy,the pace of reform of the RMB exchange rate system and the market-oriented reform of the RMB exchange rate formation mechanism,the impact of changes in the RMB real effective exchange rate has been complicated and it's uncertainty(amplitude and direction)of the two-way fluctuations has become the "new normal".In this context,it is increasingly important to study and use changes in the real effective exchange rate(direction and magnitude)of the RMB to optimize China's export industrial structure.Based on the previous research results,this article starts from the relationship between the Balassa-Samuelson Effect and industrial development,combines the theory of incomplete exchange rate transfer with the development of the industry.The theoretical analysis framework of the micro-mechanism and macro-process is built up to analyze the impact of the exchange rate fluctuation on the upgrading of the export industrial structure.This article demonstrates that the exchange rate fluctuation affects the adjustment of the export industrial structure and the promotion of the overall industrial structure optimization mainly through the price transmission and changes in competitiveness of import and export trade,international capital flows(FDI & OFDI),global production factor reorganization and other factors.As a reference,this article examines the relationship between the export industrial structure upgrades and exchange rates in the United States,Japan,and China,and their exchange rate policy experience,and then establishes a model to further verify the relationship between the quality of export products and the exchange rate and its effect on the export industrial structure upgrading.Based on the Target-Zone Exchange Rate Model of Krugman,a standard CGE was constructed to simulate the impact of exchange rate fluctuations on various economic and industry variables in China,thereby providing empirical support for the construction of exchange rate corridor boundaries to achieve the range management of exchange rate fluctuation.Finally,this article puts forward some policy suggestions on the exchange rate policy of the optimization and upgrading process of export industrial structure and its implementation environment.Our research suggests that the government should pay attention to the exchange rate policy tools for guiding the optimization and adjustment of the export industrial structure.The adjustment and optimization of the export industrial structure have both the leading role of the market and the government's administrative intervention.The exchange rate,as one of the government's policy tools for regulating economic operations,must make the "two hands" play a better role.Under the premise of respecting market leadership,the government can adopt a variety of policy tools or measures to move production factors and productivity resources from inefficient export industries to highly efficient export industries,thereby improving the efficiency and level of overall economic operations and make the "Structural dividend" become the driving force for the sustained economic growth and high-quality development in the new era.As one of the important regulating variables of macroeconomic regulation and control under open conditions,the exchange rate can rely on the transmission effect of exchange rate price signals to promote the full adjustment of the export industrial structure through the intrinsic driving mechanism of the market competition mechanism,leading to the adjustment and optimization of the export industrial structure or deterioration.Especially in the reality of China's opening door constantly,the role of the exchange rate in regulating the export industrial structure is getting more and more important,and it will definitely become an important price mechanism,that is,guiding the import and export prices,changes in the size of imports and exports and the overall domestic price level,thus achieve in-depth adjustment of various economic variables related to the export industrial structure.Therefore,under the function of the market mechanism,the appropriate adjustment of the exchange rate policy of a country,and the appropriate control of the direction and amplitude,can not only find a larger market and profit survival space for export companies with increasingly fierce international competition,but also enable economic development.The discretionary choice between domestic and external demand will have an important impact on the optimization of the export industrial structure,especially its upgrading,and the sustained and healthy development of the national economy.Our research holds that in the production-oriented export industry development,the response to exchange rate risk is how highly industrialized and optimized the export industry structure stands.The overall export industrial structure of a country can be assessed by its dynamic position and its competitive advantages in the restructuring of the global industrial chain.The real viability of an enterprise in the global industrial competition is reflected in its added value weight and competitive advantage in the formation of global value chain,and this viability is more reflected in the high-tech added value or production factor endowment of its export products,the operation and management ability of the enterprise in the face of domestic and international markets,the number of relevant talents and technical resources,and technological innovation new capabilities,the ability to acquire intellectual property rights,the comprehensive ability to cope with changes in the international market environment,the ability to cope with the risks of large fluctuations in the exchange rate,etc.It is the comprehensive function of these capabilities that can truly form the competitive advantage of export industrial differentiation.Fundamentally,we are considering the full factor competitiveness of an enterprise or industry.Therefore,it is impossible for the government departments to rely on temporary environmental changes or policy protection to guide export industrial restructuring.In contrast,for industries that mainly rely on cheap production factors and are at the elementary element-oriented and resource-dependent endowment stage,the lowprice expansion of industrial development space products will be affected by exchange rate fluctuation,resulting in a restrained demand situation.The formation of a sustainable and competitive export industrial structure is inseparable from technological progress.External pressure can motivate export enterprises to generate internal motivation to improve product quality and international competitiveness,and promote enterprises to improve production technology and labor productivity,rather than simply expanding reproduction at a low level.The government should change the policy background of the environment in which the export industry is located,improve the competitive environment,and give play to the role of the market,so as to promote the combination of higher-level production factors to promote the competitiveness of enterprises and ultimately promote the process of high-level transformation of the export industrial structure.Our research holds that the direction and range management of exchange rate fluctuation should be well grasped when using exchange rate policy to promote the optimization of export industrial structure.The exchange rate policy pursued by China in the past tends to underestimate the RMB exchange rate,adopt relatively strict foreign exchange controls,increase foreign exchange income through the increase of net exports,and increase national foreign exchange reserves.However,this policy has also caused China to form low-level,redundant construction at the primary industry level,correspondingly limiting the development of China's highly advanced export industrial structure.We hope to take advantage of the favorable timing of RMB appreciation,strengthen the introduction of high and new technology,upgrade the original innovation and technology level,force export enterprises to eliminate low-value-added industry products,release production factors to develop high-knowledge technology and high-tech value-added industries,and promote the optimization process of export industry and even the entire economic structure.It should also be noted that the impact of exchange rate fluctuation on the highly structured export industry is only an aspect of industrial structure adjustment.Other policies may also change the advantages or disadvantages caused by exchange rate fluctuation.Therefore,the adjustment of export industrial structure guided by exchange rate policy needs the active cooperation of a series of other domestic economic policy tools.Under the condition that exchange rate fluctuation becomes normal,the ability of export enterprises to avoid exchange rate risk is challenged.Enterprises should actively promote the adjustment of export industrial structure,improve the ability to adapt to exchange rate fluctuation and respond to exchange rate risks.Considering the influence of RMB exchange rate fluctuation on the scale and structure of China's import and export industry,the formulation of policies and development plans of relevant industries must take the exchange rate factor into account,China should not only make good use of the promotional effect of exchange rate changes on the optimization and upgrading of export industrial structure,but also determine the boundary of government intervention and achieve the range management of exchange rate fluctuation through the construction of RMB exchange rate corridor,so that there is a relatively stable financial environment for export industrial upgrading and structural optimization.