Among the roughly 300,000 small and medium enterprises (SMEs) in Shenzhen, only 20 percent, or 15,000 firms, obtained bank loans this year and the rest were still facing great difficulties in obtaining finance, an official told a forum Friday (Dec 4).
At the Multi-tier Corporate Financing Seminar at the Third China (Shenzhen) International Finance Exposition, which opened at the Shenzhen Convention and Exhibition Center on Friday, Xiao Zhijia, deputy director of Shenzhen Financial Office, said the growth board was far from satisfying the financing needs of small and medium firms.
"One of the proofs that the global economic downturn is bottoming out is that SMEs have started flourishing again", Xiao said. "However, a great proportion of them are still struggling because of a lack of funds. According to statistics provided by the Shenzhen branch of the People's Bank of China, about 80 percent of SMEs in Shenzhen had not obtained bank loans this year."
Co-organized by the U.K. Trade and Investment and China Britain Business Council, the forum brought together experts from U.K. banks including Standard Chartered Bank and Royal Bank of Scotland to give advice to Shenzhen businessmen on how to obtain funds.
The United Kingdom has rich experience in helping SMEs grow, from which Shenzhen companies can learn a great deal, Xiao said.
"Among Chinese companies, 99.8 percent are SMEs, which contributed to about 68 percent of the country's gross domestic product (GDP) and provided 78 percent of the country's new job vacancies" , said Danny Phua, vice president of Standard Chartered Bank's SME banking section.
Phua suggested small firms at different development phases could adopt different financing schemes, while Choi Yiu-ting, director of Royal Bank of Scotland’s corporate finance section, explained how companies could achieve their goals in making domestic and overseas mergers and acquisitions.
The China (Shenzhen) International Finance Exposition, on a larger scale than the previous two years, had an exhibition area of 30,000 square meters. More than 500 banks, insurance companies and other financial institutions offered wealth-management products as well as around 800 job vacancies during the three-day fair.
