Survey finds China’s SMEs still struggling, with liquidity tightening
The SME Development Index, which tracks 8 major industries, fell to 88.7 in September, the lowest level in a year
China’s small and medium-sized enterprises (SMEs) continue to face an uphill battle, with their economic performance still lagging behind pre-Covid levels, according to the latest reading from a semi-official index.
In September, the SME Development Index, which surveys 3,000 businesses across eight major industries, fell to 88.7, the lowest level in a year and well below the pre-pandemic quarterly average of 92.9 in 2019.
The index’s threshold for stable economic conditions is 100, and a reading below 100 indicates a downward or deteriorating economic trend for SMEs.
“It is crucial to accurately understand the difficulties and challenges faced by SMEs, intensify macroeconomic adjustments, deepen reform and opening-up … [to] create more opportunities for SMEs and private enterprises, boosting their internal drive and growth potential.”
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China’s SMEs have been hard hit by the nation’s sputtering economic growth, and their confidence has been dampened by half-hearted government support and sweeping and abrupt regulatory shifts in private sectors such as real estate, video gaming and off-campus education since 2021.