Impact Of RMB Appreciation On Readjustment Of Industry Structure In Zeng Cheng

Since the reform of RMB exchange rate system in the July 21,2005 great and complicated changes have taken place in the industrial structure of some industries and regions,particularly in the Pearl River Delta region.The research on the impact of RMB appreciation on readjustment of industrial structure in a county-level city was very poor Based on the financial economics,this paper presents a thorough study of the readjustment problems of the industrial structure in a county-level city(e.g.Zengcheng).By using comparative analysis,empirical analysis and investigating,This paper studies the impaction of RMB appreciation on readjustment of industrial structure in Zengcheng.Firstly,we find that the trends of RMB appreciation is linked micro-trumpet with the tendency in the three industrial structures that primary industry is decreasing,secondary industry is stabile and tertiary industry is increasing.Secondly,we can find the influence of the RMB appreciation to the three pillar industries in Zengcheng.It is obvious adverse to the textile and garment industry,and as an obstacle to sustainable development of the industry.It is a positive associated with auto industry, promoting the readjustment of industrial structure in Zengcheng to advanced and moderate heavy. The influence to the motorcycle industry is double-sided which brings challenges and opportunities.Although it has not yet brought a big challenge to the industry,the influence will begin to show with the cumulative effect of further RMB appreciation in 2008Thirdly,for the impact to macroeconomic,RMB appreciation appears clearly positive relationship with the ratio of local financial revenues in GDP,positive relationship with the general budget revenue and the volume of exports,negative relationship with the ratio of fixed asset investment in GDP and consumption.It is shown that the appreciation inhibits investments,because the appreciation makes it more difficult to attract foreign capital and investment revaluation in recent years after appreciation than before.The cumulative effect of RMB appreciation has become apparent since the second quarter of 2007.In this context,we draw four major strategies,such as promoting upgrading of the industrial structure by the appreciation,.etc..Then draw five further specific suggestions such as:To accelerate the optimization and upgrading of traditional industries,and take the New-style Industrialization framework,etc.