How to avoid foreign exchange risks in international economic activities is a very important issue for enterprises. Because enterprises are different from banks, they do not aim at earning foreign exchange spreads. Therefore, we should proceed from our own business strategy, predict the exchange rate and choose the most appropriate hedging measures to obtain operating profits. Compared with banks, enterprises are more flexible and diverse in preventing foreign exchange risks.
Means and methods of preventing enterprise transaction risks
1. Take currency hedging measures.
Currency hedging measures refer to the appropriate hedging clauses entered into by buyers and sellers in the transaction contract to cope with the risk of exchange rate changes during the transaction negotiation. Commonly used are hard currency hedging clauses and basket currency hedging clauses. The hard currency hedging clause refers to the agreement in the transaction contract that it is denominated in hard currency and paid in soft currency, and the exchange rate of the two currencies at that time is stated. During the execution of the contract, if the exchange rate of the payment currency falls, the contract amount shall be adjusted in proportion and calculated according to the payment exchange rate, so that the paid-in currency value is the same as when the transaction contract is signed.
A basket currency clause refers to the clause that both parties explicitly link the payment currency with the comprehensive value of a basket currency in the contract, that is, determine the exchange rate between the payment currency and various currencies in a basket currency when concluding the contract, and stipulate the adjustment range of exchange rate changes. If the exchange rate changes beyond the specified range when the payment is due, it will be adjusted according to the exchange rate at the time of payment to achieve the purpose of maintaining the value. Usually, the SDR is used as a "basket" of currencies.
2. Choose a preferential pricing currency
In the international financial market, there are soft currency and hard currency. Hard currency refers to a currency with a relatively stable exchange rate and a floating trend; Soft currency refers to the currency whose exchange rate is unstable and has a downward trend. It is also an important way for enterprises to guard against foreign exchange risks by choosing the appropriate currency in the transaction process.
Enterprises in the transaction process, the choice of pricing currency should follow the following principles:
(1) Select a freely convertible currency. It is convenient to carry out exchange transactions in the foreign exchange market at any time according to the changing trend of exchange rate, and transfer the exchange rate risk of currency.
(2) Soft currency is used for foreign exchange payment and hard currency for foreign exchange income. But in practice, the "soft" or "hard" of various currencies is not absolute, and their soft and hard conditions often change. Strictly speaking, this method sometimes can't guarantee economic entities to avoid losses caused by exchange rate changes. In order to avoid exchange rate risk, enterprises can adopt other hedging tools, such as forward foreign exchange transactions and currency hedging clauses, when they cannot "export currency and import soft currency". In a word, enterprises should be both principled and flexible.
3. Use forward foreign exchange transactions.
Forward foreign exchange transaction means that after the contract is signed, the import and export enterprises make forward foreign exchange purchase (sale) payment to the bank, and the contract exchange rate is determined in advance according to the forward exchange rate of the corresponding period with the trade settlement date as the contract delivery date.
4. Adopt international loan method
International lending law means that in the medium and long-term balance of payments, on the one hand, enterprises use international credit to obtain financing; On the other hand, transfer or offset foreign exchange risks. There are three main forms: export credit, "deferred payment" and guaranteed payment agency.
(1) Export credit is the most commonly used financing method in international trade. The exporter's bank directly or indirectly provides advance payment to the importer, the main purpose of which is to promote export by providing funds to the importer. There are two kinds of export credit: buyer's credit and seller's credit. By means of export credit. Exporters' foreign exchange risks are passed on to banks or offset.
(2) The so-called "deferred payment" business refers to the long-term and medium-term bills issued by exporters to importers in large-scale machinery and equipment transactions with deferred payment, which are sold to export banks after being guaranteed by tier-one banks and accepted by importers, and the amount after deducting discount and other expenses is obtained. Because the exporter sold it at the time of discount, the refusal of future bills of exchange has nothing to do with the exporter. At the same time, exporters can get cash immediately and transfer foreign exchange risks to discount companies or banks.
(3) The secured payment agent means that in international trade, the exporter can't get the importer's bank to open a letter of credit to collect the payment, and he is not sure about the payment, that is, he resells the documents payable by the importer to the secured payment agent in the form of discount to get 80%-90% of the accounts receivable, and the rest will be collected at maturity. Because exporters get most of the payment in advance, they can reduce the foreign exchange risk.
5. Take the way of settlement in advance or delay.
The method of advancing or delaying the settlement of foreign exchange means that in the balance of payments, enterprises predict the changing trend of the exchange rate of the payment currency and advance or delay the receipt and payment of foreign exchange funds in order to reduce the foreign exchange risk.
6. Hedging of derivative financial instruments
Hedging with derivative financial instruments mainly includes currency options, currency futures and swap foreign exchange transactions.
(1) Currency options give contract buyers the right to buy or sell a certain amount of a certain currency at a specified price within a certain period of time. The buyer in option contracts has the right to execute the contract without the obligation to execute it, so that the enterprise can choose whether to execute the contract according to the future exchange rate changes, thus achieving the purpose of preventing foreign exchange risks. The disadvantage is that the amount and duration are difficult to be completely consistent with spot trading, and a certain option fee has to be paid.
(2) Currency futures are actually forward foreign exchange contracts with standardized amount, term and expiration date. The hedging of futures trading refers to a transaction in the spot market with the opposite direction and the same term, and the profit in the futures market is used to offset the loss in the spot market. The disadvantage is that futures contracts are standardized, and it is difficult to be completely consistent with the spot market in terms of amount and duration, and it is impossible to achieve the goal of completely preventing foreign exchange risks.
(3) Swap foreign exchange transaction means that the buyer sells A coins delivered on one day, and at the same time sells A coins delivered on another trading day and buys back B coins. The characteristic is that the two foreign exchange transactions are equal in quantity, opposite in direction and different in delivery date.
Means and methods to prevent the risk of enterprise restructuring
As for the translation risk, the translation profit and loss is a kind of profit and loss on the accounting book, which generally does not involve the change of the real value of the enterprise. Therefore, conversion risk is different from transaction risk, and this book risk mainly affects the accounting statements provided by shareholders and creditors. However, this conversion profit and loss also reflects the foreign exchange risk borne by the enterprise to some extent. There are two main ways for enterprises to guard against conversion risks: balance sheet neutralization and risk hedging.
(1) In the balance sheet, enterprises are required to adjust their assets and liabilities so that the amounts of assets and liabilities expressed in various functional currencies are equal and the risk difference between assets and liabilities is zero.
(2) The risk hedging method uses the gains and losses of foreign exchange contracts to offset the translated gains and losses through financial market operations. However, due to the existence of tax differences, it is sometimes difficult for risk hedging operations to effectively reduce the actual risks of enterprises.
Means and methods to prevent economic risks of enterprises
Economic risk is a measure of the sensitivity of an enterprise's future cash flow to potential exchange rate changes, and the main goal of its prevention is to isolate this influence. Therefore, enterprises can choose the following measures to reduce economic risks according to the characteristics of production and operation.
1. Marketing strategy selection
When the local currency appreciates, domestic products will be in an unfavorable competitive position in the international market, and the domestic market potential is relatively large. At this time, enterprises should pay attention to the development of the domestic market.
2. Production adjustment strategy
When the exchange rate fluctuates so violently that the above marketing adjustment is useless, enterprises should turn their energy to the adjustment of production strategy, start to reduce production costs and effectively control economic risks.
3. Financial strategy
The financial strategy is to readjust the debt structure of enterprises, so that when the exchange rate changes, the decline in the return on assets of enterprises will be offset by the corresponding decline in the cost of debt repayment. If multinational companies expect the currency of the country where their subsidiaries are located to depreciate, they should transfer the profits expressed by their subsidiaries in local currency to the parent company as soon as possible through transfer pricing. On the other hand, when the currency of the country where the subsidiary is located is expected to appreciate, the profits of the subsidiary can be delayed and transferred to the parent company, and even the profits of other subsidiaries can be transferred to the subsidiary through transfer pricing.