China’s registered small- and medium-sized enterprises (SMEs) have exceeded 4.3 million and contributed to 58.5% of gross domestic production.  The 4.3 million SMEs, more than 95% of which are privately owned, contributed to 50.2% the country’s total tax revenue.  SMEs make up 66% of the country’s patent applications and develop about 82% of its new products, according to Chairman Li Zibin of the China Association of Small and Medium Enterprises. 

Li said that SMEs still have to cope with a number of difficulties, including an inadequate regulatory environment, difficulty in obtaining financing and immature public services.  To solve the problem, China has come up with a series of measures, including a law on the promotion of SMEs.  Following the promotion, the outstanding loans granted to SMEs had risen to 5.35 trillion yuan by the end of 2006, an increase of 539.6 billion yuan or 15.8 percent from the year beginning, according to official data.  By the end of June this year, China’s five large commercial banks including Industrial and Commercial Bank of China, Agricultural Bank of China, Bank of China, China Construction Bank and Bank of Communications have granted 1.5 trillion yuan to 535,900 SMEs, 120 billion yuan or 8.3 percent more than that at the beginning of this year.  Social conditions for SMEs development are getting better while the SMEs have to optimize its structure, establish modern enterprise mechanisms as well as improve product quality, enterprise credit and social responsibility, said Bao Yujun, an expert in SMEs.   Source: Xinhua

BIIA Newsletter October – 2007 Issue