Economic Watch: China mulls five-year plan for SMEs

China is taking further steps to increase its support for the country's small and medium-sized enterprises (SMEs), with solid measures to encourage sci-tech innovation and stimulate their vitality.

The Ministry of Industry and Information Technology (MIIT) is working on a five-year plan for the growth of SMEs, which underlines key tasks including improving a level playing field, increasing financing availability and enhancing innovation capacity and professionalism.

From 2021 to 2025, the country is expected to incubate and cultivate about one million innovative SMEs and 100,000 SMEs that feature specialization, refinement, uniqueness and innovation, said MIIT Minister Xiao Yaqing.

According to Xiao, the country also plans to incubate 10,000 "little giant" firms, which refer to small enterprises, still in the early stage of development, focusing on the new generation of information technology, high-end equipment manufacturing, new energy, new materials, biomedicine and other high-end fields.

A total of 1,140 "little giant" companies enjoyed operating margins of 13.2 percent in the first eight months, an MIIT survey showed.

To further improve the technological innovation capacity of SMEs and resolve their difficulties, the country is unfolding a slew of measures.

China plans to build a number of national manufacturing innovation centers and generic technology platforms in key areas, as well as to support the integration of small and medium-sized enterprises into industrial chains, supply chains and value chains, according to the MIIT.

Calling for integrated innovation development pattern for large, medium and small enterprises and upstream and downstream firms, the ministry also proposed to increase inclusive finance support for small and micro-businesses.

Providing richer asset certificates for SMEs and reducing their loan pressure would be one of the many innovative practices to solve their financing difficulties and delayed payment and collection.

As of June 2021, Chinese logistics service platform Lionbridge has served more than 3,000 small, medium and micro logistics enterprises and provided financing support of more than 900 million yuan (about $140.87 million), by conducting asset capability assessment based on big data covering car rental, shipment and transportation volume.

In addition, some industrial internet platforms have provided financing services for SMEs in the industrial chain by enriching information and capability certificates such as supply chain delivery and stocking.

To solve the problems of insufficient credit construction and direct financing, more efforts will be made to promote the establishment and improvement of enterprise-related data and information-sharing mechanisms and to support fintech to empower SMEs in financing innovation, according to the MIIT.