The China import and export fair, also known as the Canton fair has opened in Guangzhou. As China's largest trade fair, it's the barometer of the country's trade and development. This year however, many buyers and sellers are watching the yuan exchange rate dispute with some concerns.

Worries of the stronger yuan has weighed on the nation's exports. 70 percent of the sellers polled at the fair say that export companies are under great pressure. The appreciation of the yuan has affected exporters whose profit margin normally ranges from 2 to 5 percent. But now, their profit margin might be reduced by one percent. That's a big loss in sales. Therefore, sellers and buyers now prefer to sign short-term contracts.

One registered seller said "Unlike last year, this year we have decided to not sign long term orders. Due to many uncertain factors, we'll sign short-term contracts, like for two months, or three months."

Officials from China's Ministry of Commerce say abrupt fluctuations of the yuan would hurt the country's economy. It will also strain the investment environment in China with increased taxes and reduced export quotas.

Chong Quan, Int'l Trade Rep. of Ministry of Commerce said "The currency dispute is really harmful to the world economy. Countries and companies find it hard to make an objective judgment of the situation. This in turn, undermines the public's confidence."

The Canton Fair is China's largest bi-annual trade fair, since 1957. Exhibits at the fair include mechanical and electrical products, textiles, food and other consumer goods.

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