Change in perception required

Small and medium-sized enterprises need financial credit and broader support to drive the economy and create jobs

For some time now, the difficulties facing small and medium-sized enterprises (SMEs), especially small and micro ones, have aroused the attention of the nation's authorities. The State Council has pledged stronger financial and fiscal support to help with the development of cash-strapped small and micro-sized enterprises, clearly increased the tolerance for the non-performing loan ratios of small enterprises and extended the scope and expiration day of the policy reducing half of the business tax to the end of 2015, which is considered a direct favor for SMEs currently suffering economic difficulties.

It is normal for enterprises to encounter challenges in survival and development, but is significant that most SMEs have faced greater difficulties recently than during the financial crisis in 2008. SMEs seem to be struggling with the high inflation caused by the previous over-easing monetary policy, which has resulted in a compression of the loan scale and higher interest rates. This has made financing difficult for SMEs.