SMEs look for leaders to restore confidence
Updated: 2011-11-14 07:40
By Tan Yingzi (China Daily)
HONOLULU - Faced with a global economic slowdown and a crisis in the eurozone, Chinese executives have urged Asia-Pacific leaders to do more to restore market confidence and help small and medium-sized enterprises (SMEs).
Reflecting its rapidly growing regional economic influence, China this time has its largest delegation of business leaders, with nearly 300 members, at the 2011 Asia-Pacific Economic Cooperation (APEC) forum.
Four Chinese business leaders attended the APEC Business Advisory Council (ABAC) meeting, which usually allows up to three representatives from each of APEC's 21 member economies.
The ABAC members are appointed by APEC leaders to provide insight into the priorities and concerns of the business sector.
Yang Yunsong, CEO of Tsinghua Agriculture Co Ltd, is one of the ABAC members. He was also selected as chairman of the ABAC SME and Entrepreneurship Working Group, a new panel set up this year.
"It shows that the expectations of the Chinese business community are very high among the member economies," Yang said on the sidelines of the APEC CEO summit on Friday.
But like his counterparts elsewhere in the world, Yang said that he feels "uncertain and negative" about the future of the world economy.
"For us business people, confidence is very important," he said. "We need the APEC leaders to do something to restore our confidence."
Beyond confidence, SMEs in the region also care about how regional trade rules will affect them, and they expect governments to provide more assistance in exploring new business opportunities, he said.
SMEs are the engines of innovation and economic growth in the region, making up about 90 percent of all businesses and accounting for nearly 60 percent of employment, according to the ABAC.
But SMEs have been hard hit by slowdowns in developed countries since the 2008 global financial crisis.
In China, SMEs are facing a tougher and more complex domestic situation. They are experiencing soaring labor and material costs, staff shortages, limited access to financing and a stronger currency, said another ABAC member, Wang Shutong, CEO and chairwoman of DHgate.com, a China-based online trade website.
"Many SMEs in China are so afraid of the uncertain economic situation that they dare not take any large or long-term orders from international clients," she said.
Some Chinese companies are thinking of changing their business strategies and looking at e-commerce, which will help them find new clients and cut costs.
"E-commerce fits the globalized trade system well, and Chinese SMEs are very interested in it," she said. "But they still lack capabilities and human resources in this new area."
Limited access to financing remains the top concern of SMEs across the region, Chinese business representatives said.
In the ABAC three-point plan submitted to the APEC leaders, ABAC said access to financing was the top barrier to SME trade. It urged APEC economies to increase access to financing for SMEs and microenterprises.
Amid the credit crunch in Wenzhou, an economic boomtown in East China known for its entrepreneurship, the Chinese government recently called for bank credit support and tax breaks for SMEs.
Wang Lili, a senior executive of Industrial and Commercial Bank of China Ltd and an ABAC member, said that her bank is lending more to Chinese SMEs, with about 70 percent of its new loans this year going to these businesses.
"It is a really big increase and we will continue to do so in coming years," she said at a news conference on Friday.