Meaning and Purpose of
Enterprises’ International Credit Rating and Promotion
3.Influence of Credit on Healthy Development of National and Social Economy
In China’s current market economy construction and enterprises’ commercial exchanges, breaking credit has become a black stream with a flooding trend, which greatly influenced the healthy development of the whole national and social economy.
(1) Deficiency of enterprises’ credit causes confusion of economic order. When somebody breaks credit, those who follow rules and keep credit may suffer losses, so the credit losers will get more benefits. Once the phenomena becomes an ethos, it will cause vicious competition among enterprises and give rise to a series of negative influences, thus overall level of social credit will be decreased and an incurable social wound will be created. If an enterprise or a society generally lacks of sense of moral and humanitarian consciousness, lacks of respect for rules and order and lacks of systematic spirit of dedication to business, the organ itself has unsuccessful factors. When the factors accumulate to some degree, the market economic order will be irregular. When the credit losers get benefits while the credit keepers suffer losses, the credit keepers will also betray credit and such phenomena is called “Antonomie”. The phenomena continuously circulates and social economic order is therefore doomed to fall into confusion, and main bodies of economic activity will go into the orbit of deformed development without fail.
(2) Deficiency of enterprises’ credit damages enterprises’ images. Orderly development of market economy must be established on mutual trust with credit as the basis. Overall deficiency of credit makes society form a wrong understanding of “No Businessman is not Tricky”. People treat others with a defense mechanism. The basis trust between people has become a luxury in modern society. However, breaking credit only works for a short while, the terrible consequences caused by that are hard to make up in the future. Down and feather clothes exported from China to Russia sold good at first in Russia, but some producers who lost credit served bad fillers as down and feather although the approach worked for a while. The consequence was that Russians didn’t trust Chinese products any more, which greatly influenced the export and sales of other enterprises who kept credit. Nanjing “Guanshengyuan” Foodstuff Factory served overdue stuffing as fresh stuffing. When the cheating case was finally brought to light, the factory’s trust suffered a disastrous decline, and it finally went bankruptcy.
(3) Deficiency of enterprises’ credit makes the country suffer a lot. In complicated international relations, Chinese government can deal with various relations with “Five Principles of Peaceful Coexistence”, and build good image. The powerful promise and the future fulfillment of the Chinese government proved that “Chinese Keep Promise”. However, because some producers violate basic principles of honesty and credibility in foreign economic exchanges, some foreign businessmen suffered great economic losses when dealing with businesses in domestic economic activities. Some local governments mishandled the concrete problems, which also caused some negative affects. All of this greatly damaged the country’s image. In 2001, nearly 10% to 20% of GDP was the loss cost of credit.(Note: see Mr. Fu Gang Low Credibility Makes Enterprise Suffer a Lot, Economic Daily, 16th, April, 2002, 2nd Edition). Mr. Chen Qingtai, Vice Director General of the Development and Research Center of the State Council, once pointed out that direct and indirect economic losses caused by low credibility or even no credibility of some Chinese enterprises are about 600 billion RMB. (Note: see Mr. Zhou Hanhua, Credit and Law, Comparison between Economic Social Systems, 3rd Number, 2002). At the conference of NPC and CPPCC, tens of bills were once about the issues of enterprises’ credit.
(4) Deficiency of enterprises’ credit causes contortion of relevant social systems. Deficiency of enterprises’ credit always influences the normal running of relevant social systems. Lending and loan system of banks, communication habits of enterprises, construction of legal systems, running of governmental administrative management and even people’ s daily life will also be influenced. The whole social system is based upon credit. Once credit is broken, the previous balance will surely fall into confusion, and the relevant systems will be contorted. When we think over today’s system construction, we always trace back to the basic issue------honesty and credibility.
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