About $500 million will be pumped into two funds to help improve the competitiveness of small and medium-sized enterprises. The allocation will extend the life of the SME Development Fund and SME Export Marketing Fund, which are due to run out of money this year, until 2007. But two other funds set up to help these businesses will receive nothing, and $200 million of the $500 million allocation will be transferred from one of the funds, the $1 billion SME Loan Guarantee Scheme. A Trade Department spokeswoman said it would be announced later why the loan scheme and the SME Training Fund were not receiving a boost. Financial Secretary Henry Tang Ying-yen said: 'SMEs have always been a key part of our economy, representing 98 per cent of all business establishments in Hong Kong and employing 1.3 million people.' The government introduced four SME funding schemes between late 2001 and early 2002 'to help SMEs secure loans, expand access to markets outside Hong Kong, upgrade human resources and enhance their overall competitiveness', Mr Tang said. The four schemes had benefited more than 40,000 such companies since they were set up. The $200 million SME Development Fund provides financial support to projects carried out by trade and industrial organisations and professional bodies to enhance the competitiveness of small and medium-sized firms. There is no limit on the amount of assistance the fund may offer. The $300 million SME Export Marketing Fund grants a maximum of $80,000 to each applicant. It provides grants for participation in overseas trade fairs and study missions, as well as export-oriented local trade fairs.