Small and medium-size enterprises

Small and medium-size enterprises China's small and medium-size enterprises (SMEs), finger forming the bulk of the country's private investors, play an important role in employment and economic development.

China's registered small and medium-size enterprises (SMEs) exceeded 4.3 million in number and contributed to 58.5 percent of GDP, 50 percent of tax revenues, 68 percent of exports and 75 percent of new jobs every year, according to the China Association of Small and Medium Enterprises.

SMEs accounted for 99 percent of China's registered enterprises and their output during the January-September period this year equaled to about 60 percent of the country's gross domestic product (GDP), said Minister of Industry and Information Technology Li Yizhong last Thursday.

However, SMEs were often deterred from investment due to financing difficulties as banks were often reluctant to lend to them out of risk concerns, said Chen Yongjie, a senior researcher with All-China Federation of Industry and Commerce.

Chen said loans to SMEs from the start of the global downturn accounted for merely 50 percent of the total lending, although SMEs were the most vulnerable ones in the financial crisis.

In the first nine months, investment by private firms was up 27.7 percent, compared with a 48 percent rise for state-owned enterprises, according to the National Bureau of Statistics. finger

China would enhance support to SMEs next year with preferential tax policy and easier channels to raise fund, said Li Yizhong.