A high-level forum on small and medium-sized enterprise (SME) cooperation between China and France is held in Guangzhou, capital of South China's Guangdong Province. As SMEs are emerging as a dynamic force in China's economy, Chinese government attaches more significance to healthy growth of the group.
Small and medium-sized enterprises (SMEs) have played an important role not only in the country's economy but also in society at large, considers the national government.
"Our SMEs are important in driving the country's economy and addressing the rural employment issue. SMEs are a catalyst for creating a harmonious society," said Ou Xinqian, vice minister of the National Development and Reform Commission.
China has 42 million SMEs, of which more than 95 percent are privately owned, making up more than 99 percent of all enterprises in the country, Ou noted, adding that SMEs "have become an important driving force in economic and social development."
They have contributed 60 percent of the national gross domestic product (GDP), about half of the country's total tax revenues, and provided more than three quarters of urban employment opportunities.
Sizable industrial SMEs recorded 28 percent annual growth in added value during the past five years, higher than the country's annual GDP growth of 9.5 percent.
More than 80 percent of the workers laid off from State-owned enterprises found employment in SMEs, which also constitute a key source of jobs for college graduates, she said.
Ou added that SMEs make 65 percent of the country's patent applications and develop more than 80 percent of its new products.
SMEs export the bulk of China's clothes, textile products, toys and leather shoes, and are becoming increasingly involved in high technology products such as telecom equipment, electronic and biotechnology products.
They have helped push the country's economic restructuring and opening-up forward, she noted.
However, Ou pointed out that SMEs have to cope with a number of difficulties, including inadequate laws and regulations, financing difficulties and public services.
The government will pursue every possible means, including international collaboration and regulatory support, to strengthen the country's SMEs, she pledged.
"We regard helping SMEs maximize their business potential as a pressing task," said Ou.
Creating overseas business opportunities for SMEs is one of the government's goals, and several rules and regulations favoring the development of SMEs have already been issued.
January 2003, the Law on the Promotion of SMEs came into effect.
In February 2005, the State Council issued the Opinions on Encouraging, Supporting and Guiding the Development of SMEs.
The Opinions, also known as the 36 Regulations, cover seven areas including market access, financing and service.
"To ease capital shortage, many commercial and policy banks have set up special services for SMEs," Ou said.
"Some eligible SMEs have also raised funds through direct financing methods such as going public since the country's smaller Shenzhen bourse opened up to SMEs in 2005."
Currently, 136 SMEs are traded on the Shenzhen Stock Exchange.
China has also helped improve the credit situation of SMEs by strengthening credit registration and rating, information collection and distribution, Ou said.
By the end of last year, credit guarantee institutions serving SMEs across the country had raised 123.2 billion yuan in guarantee capital.
With the full implementation of the 36 Regulations, SMEs will be allowed equal access to the business opportunities from the Beijing 2008 Olympic Games, Ou stated.
