Buildings stand at a small industrial park on the outskirts of Shanghai, China, on Wednesday, April 1, 2020. Chinese manufacturing activity rebounded strongly in March, signaling that the world's second-largest economy is restarting just as it faces a growing threat from slumping external demand.
Locked
China’s own version of a banking problem
Xi Jinping wants more SMEs to help the country meet its 5% growth target. That is placing a strain on lenders.
By Anjani Trivedi
For all the talk of China's post-Covid economic revival and sweeping changes at the top, Beijing's biggest problems are (still) its small and medium companies.
As China walks a fine line with its 5% growth target, these firms have a big role to play: They make up large swathes of the manufacturing and industrial complex, contribute around 60% of gross domestic product, and account for a significant chunk of exports. Beijing began talking up measures to help small and medium enterprises, or SMEs, in January this year. President Xi Jinping has urged these businesses (like many times before) to hum along and churn out goods, promising backing.
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