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China's local governments are introducing a number of supportive measures to help small and medium-sized enterprises cope with the impact of the novel coronavirus outbreak.
More than 10 provincial or city-level governments have rolled out policies since Sunday that focus on financial support and burden reduction to ease the pressure on SMEs from the economic impact of the virus, such as offering fast-track loans with lower interest rates and delaying social security contributions.
Experts said such actions are able to help stabilize SMEs' daily operations to ensure employment and safeguard economic vitality, which is a common practice in developed economies.
"SMEs are a major force in the Chinese economy for employment, tax revenue and exports, but they are relatively more susceptible to challenges caused by the epidemic, due to their vulnerable resource accessibility and operational flexibility," said Zhou Mi, a senior researcher at the Chinese Academy of International Trade and Economic Cooperation.
"The new measures many local governments have adopted can boost SMEs' ability to cope with the impact in a number of ways by reducing their operating costs and ensuring the financial and public services the SMEs urgently need."
Suzhou, Jiangsu province, introduced 10 measures on Sunday to enhance financing channels and efficiency, cut taxes and fees, and stabilize employment for SMEs.
Local banks are asked to set aside special loan programs with lower loan interest rates for SMEs affected by the virus outbreak.
Enterprises that do not lay off employees will have 50 percent of the unemployment insurance contributions they paid last year reimbursed to them by the government.
Qualified SMEs are also permitted to delay or reduce payments of land use tax, property tax, social security insurance programs and rent due to State-owned properties.
Governments in many other regions, including Beijing, Shanghai, Chongqing as well as Shan-dong and Hainan provinces, have been introducing similar policies.
The Beijing municipal government decided to provide subsidies for rent, daily maintenance costs and product research and development subsidies to qualified SMEs, as well as special subsidies to landlords that offer rent reductions to SME tenants.
The city is also providing a notary service and legal consultation for SMEs affected by the epidemic.
Zhou suggested that new technologies, such as remote collaborative office software and e-government applications, should also be taken into consideration by policymakers.
Thus, SMEs could sustain and even enhance their operational efficiency to better cope with capped flows of personnel and production materials, he said.
Ao Yanjie, chairman of Beijing Union Smart Energy Co, an SME with 10 employees in the decentralized integrated energy sector, said he is looking forward to the actual effects of the government's supportive measures for SMEs.
"A reduction in tax and rents is helpful, but what matters most to us is that policies facilitating SMEs' financing will be implemented," he said.
"Our company has built up a reputation among customers and investors, but the epidemic has disrupted the normal financing and cash flows of startups like us, and we really need help for easy and quick financing from either banks, investors or special SME fundraising programs."