The Effects Of Rmb Exchange Rate Volatility On China's Logs Import

Logs belong to the national strategic materials,and the stability of logs supply in China is of great significance for the domestic timber market and the development of the entire economy.The awareness of forest conservation in international society has brought about big challenge for China,which has a large scale of timber import.Under such circumstances,the effect of the exchange rate of the RMB on the import trade of logs in China has become an important question.There are many factors that affect the import trade of logs.The exchange rate is one important factor of them.At present,China is implementing a managed,floating exchange rate system that is based on a currency basket.This paper will study the law of changes in China's log imports and import prices in this context.Through the establishment of an empirical model,the factors that determine the import volume and import price of logs are included in the equations,respectively.The effect of exchange rate fluctuations on the logs is examined.Finally,suggestions are proposed that are conducive to the stable and healthy development of the log import industry in China.This is also the purpose of the paper.In terms of content,the first chapter is the introduction.It introduces the research background,importance,and research methods,technical route and innovation of this thesis.In addition,it summarizes the literature review from three aspects.The second chapter first defines the three concepts of RMB exchange rate,exchange rate risk and exchange rate transfer.Then,it introduces the relevant theoretical basis of exchange rate and balance of payments.The first part of the third chapter describes the evolution of the RMB exchange rate system and the trend of the RMB against major world currencies.The second part describes total import volume,import country structure,and import structure.Then,it analyzes the current status of China's imports of logs.Chapter 4 is the empirical analysis.Based on theoretical framework,four variables affecting the import volume of China's log imports are derived.Then the GARCH model is used to measure the fluctuation risk of the RMB exchange rate.Then the cointegration analysis is used to discuss the long-term equilibrium effect of the RMB exchange rate on China's log import trade.The VECM model analyzes its short-term dynamic relationship.Chapter 5 focuses on price change of China' log import.Based on theoretical framework,four variables affecting the import price of Chinese logs are derived.Then the cointegration test is used to prove that there is a long-term cointegration relationship between the variables.The price transfer effect is incomplete.Then,the VECM model is used to analyze short-term dynamic relationships between variables.The chapter 6 summarizes the full text,elaborates the research conclusions,and puts forward some policy suggestions.Through theoretical and empirical analysis,this paper concludes that exchange rate fluctuations can easily cause instability in China's log market.China's log imports should adopt more measures to avoid exchange rate risks,such as using multiple foreign exchanges as settlement instruments to spread risks,taking commodity futures,foreign exchange options and other financial means to hedge.