SMEs driving economic growth of China
Micro, small and medium-sized enterprises in China “have showed strong resilience and vitality against headwind as local governments pushed to improve their business environment”, a government minister told a forum for national SME development.
Vice-minister of industry and information technology Xu Xiaolan said: “The number of major SMEs surged 10.5% in 2022. The combined operating revenue and profits of these companies during the period rose 5.2% and 1.1% respectively, year-on-year.”
Xu said Chinese SMEs continue to improve the quality of the goods and services they produce. She said by the end of 2022, “specialized and sophisticated SMEs with novel and unique products accounted for 27% of the total of A-share listed companies and more than half of initial public offerings during the year”.
She pointed out the goal for 2023 is to create a business environment supporting more than 80,000 SMEs by the end of this year.
She said both local and central authorities will adopt policies that help create a favourable environment where SMEs can thrive, and encourage more social capital to invest in the early stages of a SMEs development.
According to a report released by China Centre for Promotion of SME Development at the forum, the country’s top five cities for facilitating SME development and growth are Shenzhen, Shanghai, Nanjing, Guangzhou and Beijing.
The report said that, despite global economic challenges and the Covid-19 pandemic, the number of newly registered SMEs in the 36 surveyed cities by the end of 2021 increased by more than 12% on the 2019 figure.
Strengthening trade ties with Australia
China-Australia’s economic and trade relations now have scope for improvement, so the two countries should strengthen their cooperation, according to China’s Ministry of Commerce.
“China and Australia are important economic and trade cooperation partners with highly complementary economic structures and mutually beneficial bilateral economic and trade cooperation,” said the ministry’s Shu Jueting.
She said that teams from the two countries have been working to arrange a visit to China by Australian Minister for Trade Don Farrell.
“During talks between the two countries’ trade and commerce ministers in a previous meeting, the two sides had professional, practical and candid exchanges on how to properly handle each other’s key economic and trade concerns, including exchanging views on WTO cases, Shu said.
“China is willing to communicate with Australia on technical issues regarding respective concerns in bilateral trade and seek win-win solutions,” she added. “We hope that Australia will meet China halfway and provide a fair, open and nondiscriminatory business environment for Chinese enterprises to conduct trade and investment in Australia.”
According to Zhang Yansheng, chief researcher at the China Center for International Economic Exchanges, closer relations between China and Australia will benefit both countries, as well as the wider regional economy.
“It is wise to place emphasis more on economics than politics to expand common interests,” he said.
China is Australia’s largest two-way trading partner in goods and services, accounting for nearly one third (32.2% ) of Australia’s trade with the world. Two-way trade with China grew 6.3% in 2020-21, totalling $267 billion (Australia’s global two-way trade declined 5% during this period).
The country’s goods and services exports to China totalled $178 billion in 2020-21, up 6.2% compared to 2019-20. This increase largely reflects an increase in goods exports (up 10.8% in 2020-21). Services exports were down 3.16% in the same period as a result of the Covid-19 pandemic.
The Australian government’s Department of Foreign Affairs and Trade said: “The China-Australia Free Trade Agreement (ChAFTA) entered into force on 20 December 2015. ChAFTA is an historic agreement that is delivering enormous benefits to Australia, enhancing our competitive position in the Chinese market, boosting economic growth and creating jobs. Businesses have taken advantage of lower tariffs under the agreement, with a utilisation rate of over 90% in both directions.”
