What materially affect the LED industry when the Britain exiting from the EU
Issue Time:2016-07-18
Since the United Kingdom declared "exiting from Europe" whereby the results of the referendum, attracted the attention of the international community, the British newspaper "Independent" issued a document that the referendum is the biggest destruction to the British politics since the 1920s. German Vice Chancellor Gabriel on Twitter to comment on, said, "For Europe, today is a bad day." The United States also began to worry about the UK off Europe will hurt itseves' business investment, the "UK off Europe" will have a significant impact on the global economy according to media prediction. After the referendum results were announced, CCTV and other major media also made a specific analysis about the influence on the manufacturing in China due to the British off the European, analysis suggests that the British off the European have not a big direct impact on the Chinese economy, but the impact of the chain should not be overlooked.
So, off Europe for British will have a good or bad infect on manufacturing in China and even the LED industry we most concern about?  whether we should happy or worry about it? The authors will demonstrate its main impact through specific data from 3 aspects.


1.The strategic cooperation between China-EU  will be difficult
In recent years, the Sino-British trade frequently, creating more and more common economic interests. To achieve mutual benefit and as a member of EU, Britain gradually transformed into China's important partners and supporters, for example, Britain lobbied the EU to recognize China's market economy status in order to help China achieve tariff reduction. In addition, the United Kingdom also vigorously promote China - EU Free Trade Agreement.
If this total amount of funds up to billions of dollars are successfully signed, that will bring huge Chinese manufacturing trade orders, contributing to the overall open European market. For Chinese LED enterprises, Britain also has a huge market, the UK is also expanding LED market.


However, once the British "off Europe" , which indirectly break the invisible ties of cooperation between China and the EU. With the EU early implementation of trade policy will also be difficult, and become high sunk costs.
At present, China works on international trade based on the whole European economy, after the British off Europe, the trade bewteen China-EU and the China-British maybe will go on separately, which adds some uncertainty in the relationship between China and European countries.
2. Will lose many investment from Chinese enterprises
The EU is China's largest trading partner within the EU, after Germany, Britain is China's second largest trading partner. In recent years, the amount of China's LED lighting industry in British exports are rising.


London has been the financial center of Europe, a variety of financial and economic activities are carried out here. British "take off in Europe", the manufacturing industry in China, the establishment of the international market will be more difficult than previously. Because the European market is already highly integrated, form their own mature market model, close cooperation among local brands, many Chinese enterprises will be shut out.
Faced with this situation, many Chinese companies have chosen to enter the Chinese enterprises in the UK market is relatively loose, then based on it into the European market. Britain to leave the EU if a referendum is tantamount to a blockade strategy for those who wish to enter the European market, Chinese enterprises, UK Trade & Investment will lose a lot of Chinese companies.
As a member of the LED manufacturing industry, now this is the best time out of overseas markets, the perfect opportunity to meet new blue ocean overseas, but off Europe after Britain, the EU and the whole global economy will be subject to shocks, foreign trade situation is not optimistic.
3, or disrupt the RMB internationalization step
Today, the RMB has just joined the IMF basket of currencies plan, has taken an important step in the internationalization of RMB. China is pushing and major trading partner countries achieve RMB settlement policy in order to consolidate and strengthen the international influence of the renminbi.
In this regard the United Kingdom to provide strong support for the Chinese - London has become the second largest after Hong Kong's offshore RMB settlement center. Britain off to Europe, the process of internationalization of the RMB will be affected to some degree, Maybank estimates, the British retreat Europe, the biggest gains in Asian currencies will occur yen, an increase of as much as 11.7%, while the RMB and Rupee It may fall 5.2% and 5.7%, respectively.
Due to changes in exchange rates directly affect the international import and export trade, China LED companies will reduce the cost of imported British products, LED products exported to the UK but it will greatly reduce the profits, both of which will have an integrated value of the benefits is not yet what to say.
Euro triggered unrest Biranzhishi international export trade in the short term, the euro devaluation triggered a global economic turmoil, devaluation of the RMB exchange rate impact, but in the long run, the British off the European free trade between Britain negotiations on the agreement, China will take a favorable position.
For the Chinese manufacturing industry, the international market is very important, since the LED industry in China in recent years, sales downturn, many companies have to invest in overseas markets, Europe and the British off the short-term global economic turmoil still in the stage, LED industry to go abroad will be greater challenges exist.