The Hong Kong General Chamber of Commerce says the Government should take a leading role in creating a more competitive operating environment for small and medium-sized enterprises (SMEs) in light of the economic downturn. The chamber said the most direct way to do this would be for the Government to temporarily freeze its fees and charges and hope other service providers followed suit. Government SME committee chairman and chamber committee member Denis Lee Wing-kwan said while Government fees were not a large proportion of companies' operating expenses, a fee freeze would be a 'significant symbolic gesture'. 'It would indicate the Government's sincerity to SMEs in this time of economic hardship,' he said. 'Hopefully, other service providers, such as the utilities, would then follow the Government's lead and do the same.' Chamber director Eden Woon Yi-teng said the economic slump meant most companies were working harder 'by cutting costs, boosting productivity . . . and often lowering prices'. Given the business environment, the Government should also look into improving its efficiency, he said. Chamber chairman Phyllis Wong said small and medium-sized firms employed 60 per cent of the workforce and the sector's difficulties could push Hong Kong's economy over the brink. While this was the case, Mr Lee said he did not, in principle, agree with retailers demanding landlords cut rents. 'It is a legal matter of contracts . . . and a business decision on the part of the landlords whether they will cut rents,' he said. Mr Lee said retailers taking their protests to the streets indicated the severity of the economic slump. 'As a large number of [the chamber's] members are small and medium-sized retailers, we would welcome discounts if it helped make our members more competitive.' Mr Lee said he hoped retailers and landlords could settle their differences in a mutually advantageous way. 'If all the retailers went out of business because of high rents, the shops would fall empty and future tenants may be able to negotiate cheaper packages anyway.'