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The value of China's currency tops the list of issues attracting Chinese entrepreneurs' attention, a survey by a major Beijing-based market-research company has found.
Those who said they believed that they would be harmed by an appreciated yuan by far exceeded those who said they would be in a position to benefit from a rising yuan, according to the survey conducted by Horizonkey.
Some 45 percent of the executives surveyed said they regard the value of the renminbi as the top issue among their major economic concerns.
Most of the surveyed, 63.6 percent, said they think a revalued yuan would have a significant impact on their operations. Specifically, 41.2 percent of those surveyed said the impact would be negative, while 22.4 percent said it would be positive. Another 25.3 percent said there would be no impact and the remaining 11.1 percent said they did not know.
In most industries, executives favouring a stable renminbi overwhelmed those supporting an appreciated yuan. Major exceptions were the real estate and construction sectors.
The overwhelming support for a stable currency showed itself to be particularly true in the information technology, manufacturing, trading and investment-consulting industries.
In the finance industry, those favoring a stable renminbi were roughly equal in number to those favoring an appreciated renminbi.
China is now a major exporter of products such as textiles, toys, cell phones and ships. A rising renminbi would greatly hurt the interests of manufacturers of such goods and trading companies involved in their export.
The impact would be devastating for small private firms in those sectors because their financial strength is weaker still.
So it is not surprising that most executives said they feared a revaluation.
In the finance industry, 31.2 percent of those surveyed predicted a negative impact from an appreciated currency, while 30.3 percent said the impact would be positive and 23.9 percent said there would be no impact. Experts said an appreciated renminbi may help China attract more foreign investment in the short term. But it is also likely that this investment would leave the market after the renminbi's negative impact on other industries shows itself.
(China Daily October 20, 2003)
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