Research On International Trade Financing Of Foreign Trade Enterprises

With the development of international trade and China's economic strength has been continuously increasing. More and more domestic enterprises entered the international market and participated in international competition by export and import in the raw materials market and goods market. International trade has been an important factor of China's economical development which counted half part in the increasing of GDP. Either developed or developing countries all regarded international trade as an important means to promote national strength.A constraint for foreign trade enterprises to participate in international trade is shortage of liquidity. Whether importers, exporters or brokers they all faced with the problem. Large enterprises could obtain financing by many ways, but most of SMEs lack of convenient financing from banks or capital market, only depending on trade finance could provided them steady liquidity. Even the large enterprises can not neglect trade finance.In the trade finance, enterprises, banks and national political institutions are three main bodies in it. For banks, transacting trade finance is an important mark of international banks, at the same time, which could provide rich source of profit. For enterprises, the problems concentrated on self-quality.For the former problems, previous studies always focused on banks and political institutions, but neglected an important main body: enterprisesThe Main content of this paper is as follows:The first part is preface, which introduced background and significance of researching trade finance, and explained necessity of trade finance.The first chapter is matting of theory for trade finance, which analyzing definition and character of trade finance that belong to debt financing, and differ from traditional financing, it possess a character of"self-pay"and without increasing cost of bankruptcy. The development of national capital market and national financial institutes is inevitable for development of trade finance; following is flow of national capital.The next part is theoretical introduction of trade finance from three parts including funds shortage of SMEs, national payment and settlement and trade finance market. In the same time, the paper summarized former researches from domestic and foreign aspect.The second chapter compared the character of primary financing manners. For the enterprises, they must know and familiar with the character of financing manners, so they can use it for themselves. Besides, the cost of financing is an important factor to affect financing, for most trade finance manners, it's cost is lower than traditional financing cost, but enterprises should master the construction of financing cost so they could control cost and risk of financing.The third chapter demonstrated how to use financing tools for enterprises. For the foreign trade enterprises reasonable arrangements for financing tools could acquire enough liquidity and avoid some risk in foreign trade.The first part introduced three rules of using financing tools: The lowest cost financing, the lowest risk financing, financing fit to commercial ways.The next part is research of using financing tools in China, including of simple financing tools and structural trade finance.The forth chapter described problems in development of trade finance from China's reality. The first part showed progress of China's foreign trade.The second part introduced our national Export Credit Agencies: ex-im bank and Sino sure. On this basis, this paper put forward the most problems of China's foreign trade. The problem of enterprises is scarcity of Credit Evaluation System, which make high rat of bad debts. Because of scarcity of human resource, enterprises don't familiar with financing tools, so they have to wait for bank's service, and the cost of financing can't be controlled. The credit of enterprises should be strengthened and learn new settlement in the international trade, like the un-L/C.For the another main body of trade finance, the problems of banks concentrated on creative of business, which is very simple and can't Adapt to the different needs, nowadays, it's severe restrictions on the development of the banking sector. Face of competition of foreign banks, domestic banks should creative new tools of trade finance. Besides, China's bank's business almost concentrated on developed region and large enterprises.As supporting part of trade finance, political credit agency's business is not a long time, ex-im bank established in 1994, and Sino sure established in 2001.In light of these problems, the paper made a number of recommendations and measures.