Guangdong in big private push
Province comes out with steps to improve financing channels, facilities for SMEs
The Guangdong provincial government has been redoubling its efforts to produce visible benefits from policies supporting the private sector.
The “last-mile” problems in implementing the policies are mainly attributable to asymmetric information, as well as the lack of follow-up measures and precision, said Ma Xingrui, Guangdong provincial governor, when speaking about supporting the private sector in an interview with Xinhua News Agency.
The Guangdong government issued 10 measures to support the real economy in August last year, including reducing enterprises’ costs related to social insurance payments, securing and maintaining properties, and technological upgrades, which have since directly saved 123 billion yuan ($17.7 billion) in corporate costs, Ma said.
The authorities have updated and improved the measures this year, with a renewed focus on the private sector. For example, the provincial government plans to establish a working group to better coordinate support for small and medium-sized enterprises and nonpublic firms, Ma said.
Guangdong ranks top among all Chinese provincial-level regions in terms of private sector-related added value, enterprises, tax revenue and foreign trade. Nonpublic firms account for 97.7 percent of all firms operating in the province.
Private companies’ primary concern, according to Ma, relates to the business environment. Issues relating to market access and application procedures have yet to be fully addressed, and government approval processes need to be further streamlined.
To address these issues, the Guangdong government has been deepening reforms to streamline administration, delegate responsibility and improve services.
It was the first province to issue a document about creating a new model for government-business relations.
“In the long term, building a sound business environment actually requires addressing the fundamental issues of social and economic development at the root, and to do so in a systematic, strategic and visionary way, according to the new development philosophy and requirements based on supply-side structural reform,” Ma said.
A platform allowing financial services to assess SMEs’ credibility has played a role in tackling their fundraising difficulties, he said.
The Guangdong government is helping to build a social credibility system by implementing digital government initiatives. The aim is to help financial institutions more easily acquire corporate information and streamline financing approval processes.
The government will actively facilitate intellectual propertybacked financing and accounts receivable-backed financing, among other measures, to boost financing for SMEs.
As part of efforts to support nonpublic enterprises in innovation, the provincial government will work to build a platform encompassing the Guangdong-Hong Kong-Macao Greater Bay Area for sharing major technological infrastructure, conducting joint research into key technologies, and participating in large-scale scientific plans, Ma said.