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Yiwu enterprises brace for American economy PDF Print E-mail
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Monday, 29 August 2011 02:56

No matter how the U.S. debt crisis will end, Yiwu enterprises have taken necessary precautions in the face of the surging amount of insurance against default in the trade with the U.S., which has already gone beyond the total of last year to reach $300 billion, said Bi Shi, inspector
-general of the Yiwu branch of China Export & Credit Insurance Corporation.Wang Guanxing, president of Yiwu Xinhao Arts & Crafts Company, pays
attention to the reports about American economy on the Internet every day. As one of the largest root-carving enterprises in China, Wang ' s company has done business with Americans for nearly 10 years. Making profits from Americans is not easy, which requires constant attention to
the debt crisi s as well as close contact with U.S. foreign trade companies, Wang said.  The means of settlement for American orders has been changed from CIF into FOB,' he added. Wang has good reason to worry.Sources from Yiwu Customs say that Yiwu's exports to the U.S. have decreased by 11 . 6 percent in the first six months of this year .

Insurance indemnity amounted to 3.9 mln yuan last month

Recently some American companies with good credit have got some trouble. By the end of July, $1 . 5 million worth of exports from Yiwu to the U.S. had received risk early warning. Right in July, the first insurance claim caused by the bankruptcy of an American company was made in the
Yiwu branch of China Export & Credit Insurance Corporation. Two clients concernedreceived an indemnity of 3.9 million yuan. The U.S. has been among Yiwu's most important export destinations. It was once the biggest importer of Yiwu commodities, whose purchase of toys, Christmas items
and garments (knitting) made up large portions of Yiwu's exports. With such low profits, it's difficult to do business this year.
And I never accept orders with delayed payment, said Wu Ye, a jewelry dealer in the E District of the International Trade Mart.Due to reduced orders from the U.S. and the requests for procrastinating payment, she is considering export insurance. Some experts think that it is still too
early to discuss the influence of American debt crisis on Yiwu. However, the American orders have experienced subtle changes. In the past, the American orders as well as the quality control were made by Korean and Hong Kong companies. Now some American companies place orders
directly with Yiwu enterprises in order to save money, which is a great challenge to the production and management of Yiwu enterprises. Besides, the payment by letter of credit may not win the favor of yiwu business


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