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China vows to aid small businesses

Updated: 2012-02-02 09:19

(China Daily)

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BEIJING - China's State Council on Wednesday called for more efforts to support the sound development of small and micro-sized enterprises.

"Small and micro-sized firms serve as a significant channel for creating jobs, a major platform for the growth of entrepreneurship, and an important force of scientific innovation," according to a statement released on Wednesday after a State Council executive meeting presided over by Premier Wen Jiabao.

Further supports for small and micro enterprises are crucial as they are still facing great operating pressures, rising costs and financing difficulties, the statement said.

The central government will earmark 15 billion yuan ($2.38 billion) to establish a development fund for small and medium-sized enterprises, particularly focusing on newly-formed ones.

The country will strive to relieve the financing difficulties of those small companies, the statement said.

It will establish an evaluation system to provide incentives for commercial banks offering credit to small firms, and support qualified banks to issue financial bonds to get funds to lend to those firms.

China will also improve services for small companies by establishing 4,000 public service platforms for those firms, according to the statement.

The statement was one of the first concrete measures announced by the central government following repeated pledges to help entrepreneurs who have been squeezed by a slump in demand from the United States and Europe, as well as by curbs on bank lending.

It gave no details but promised a cut in taxes and fees and said small and micro businesses will be guaranteed a portion of government purchases of goods and services.

Entrepreneurs said they welcome the good news and still have some concerns.

"Fifteen billion is not a very big figure given that there are so many small and medium-sized enterprises in China. Moreover, details have not been disclosed about what kind of companies are eligible to use the money and which are not, so it's hard to say now if it will benefit our company," said Gui Ming, deputy general manager with Qianjiang Import and Export, a motorcycle maker in Zhejiang province.

"It is definitely good news for small and micro-sized enterprises. The measures that Premier Wen talked about cover a broad range of areas," said Zheng Shili, general manager of Wenzhou Golden Emperor Shoes in Zhejiang province. "I think what China's small businesses most urgently need is financial aid."

"In fact, the central government has been giving more and more attention to small businesses, so I think the environment will keep getting better for us to develop in China."

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