Textile companies exporting to Europe will try to use US dollars for settlement in the future.

In the first nine months of 2008, my country’s textile and apparel exports to the United States only grew by 1.5%, while exports to the EU maintained rapid growth, reaching 40%. At this Canton Fair, due to the obvious economic recession in the United States, the number of customers from the United States has decreased, while the number of customers from Europe has basically remained stable. Many textile and apparel companies focus on European customers. As the U.S. dollar exchange rate has continued to strengthen since August 2008, the RMB has appreciated significantly against non-U.S. dollar currencies such as the euro. In more than three months since July 15, 2008, the exchange rate of the euro against the yuan fell from 10.85 to 8.61 at the end of October, a depreciation of 20%; the exchange rate of the pound against the yuan fell from 13.61 to 10.96 at the end of October, a depreciation of up to 20%. Many companies that settled in euros and pounds in their trade with Europe suffered heavy losses. In this regard, relevant enterprises are particularly reminded that when conducting transactions with Europe, enterprises must beware of exchange rate risks. In order to avoid exchange rate risks, it is recommended that enterprises exporting to Europe try to use US dollars for settlement in the future to ensure that exports to Europe achieve the expected benefits.