Economic Daily:
What has the Ministry of Industry and Information Technology (MIIT) done to help small and medium-sized enterprises (SMEs) tide over during the COVID-19 epidemic? Also, proposals for formulating the 14th Five-Year Plan (2021-2025) for National Economic and Social Development and the Long-Range Objectives Through the Year 2035 pointed out that innovative SMEs should be supported to help them grow into important innovation sources. What measures will the MIIT take this year to strengthen the government's services for SMEs to cultivate their innovation capacities? Thank you.
Xiao Yaqing:
Thank you for your questions. Small and medium-sized enterprises are the most active and most numerous market entities in China. It has been reported that there are now 130 million market entities in the country, including more than 80 million self-employed individuals and over 40 million enterprises, among which, more than 95% are SMEs. Therefore, SMEs are the largest driving force in ensuring market stability and employment. The CPC Central Committee and the State Council have always attached great importance to the development of SMEs and have adopted numerous supportive policies. For example, in the fight against the COVID-19 epidemic last year, various parties introduced many supportive measures for SMEs facing difficulties, which helped boost their development. Last year, the MIIT, together with other departments, implemented the decisions and arrangements of the CPC Central Committee and the State Council, which can be simply summarized as "subtraction in three aspects" and " addition in three aspects."
The three aspects of subtraction relate to tax, arrears, and financial cost. Last year, we made further tax and fee cuts of more than 2.5 trillion yuan, which greatly supported the development of SMEs. We also cleared overdue payments for private enterprises and SMEs, and over 161 billion yuan in non-negotiable payments. Financial institutions and enterprises have been very supportive of SME's advancement. Last year, the average interest rate of loans introduced to SMEs, especially small and micro enterprises, stood at 5.08%, down 0.8 percentage points from the beginning of last year.
The three aspects of addition relate to services, digitization, and financial scale. Last year, more than 90,000 events were held to serve SMEs across China, providing services for over 6.7 million applicants and reaching enterprises 50 million-plus times. Meanwhile, we carried out dedicated campaigns to facilitate the digitization of SMEs and organized activities to promote business startups and innovation in manufacturing, which has driven the cultivation of more than 30,000 SMEs characterized by professionalization, refinement, specificity, and novelty in various places as of last year. Among them, a total of 1,832 "little giant enterprises" (outstanding examples among SMEs that feature professionalization, refinement, specificity, and novelty) had been developed. The loans for small and micro enterprises supported by financial institutions exceeded 15 trillion yuan, up 30.3% year on year, which is a huge increase. With so many active SMEs, they cover a wide range of fields. In addition to national policy support, local governments where SMEs are active should also provide more precise supportive policies for the development of these enterprises.
For MIIT, we want to focus on the work of "three, two, one" for the SMEs' development. The so-called "three" relate to the further consolidation of foundations in three important areas: policy system, service system, and development environment. We will accelerate the formulation of the SME development plan during the 14th Five-Year Plan period, further improve the system supporting the development of SMEs, and upgrade the SME service system to combine public services, market-oriented services, and public benefit services. These service institutions should also be guided to provide standardized, refined, and personalized services.
"Two" indicate that we will concentrate on the two key points of financing, and rights and interests protection, and seek solid outcomes. We will strengthen the synergy between the government, financial institutions, and enterprises, deepen cooperation in production and financing, incentivize financial institutions to increase credit supplied to SMEs, and further reduce financial costs. We witnessed how banks and other financial institutions made numerous efforts last year to further widen direct financing channels.
"One" relates to focusing on the improvement of SMEs' innovation capacities and assisting SMEs to grow into sources of innovation. A large proportion of innovation in the past came from SMEs, so we should in a phased way improve systems which cultivate innovative SMEs. We will strive to foster more than 10,000 "little giant enterprises" characterized by professionalization, refinement, specificity, and novelty at the national level within three to five years, adding to the existing 1,800-plus already in operation, as well as 100,000 provincial-level small and medium-sized enterprises of this kind and one million innovative small and medium-sized enterprises. Thank you.
