An Analysis Of China's Small Enterprises' Financing Constrain And Policy Selection

Nowadays, small and medium enterprises (SMEs) play a more and more important role in the promoting of our economy growth. They have a persistent influence on increasing investments,developing regional economy and solving the problem of job opportunity scarcity. By the view of government, a profound recognition has been set on both central and local governments, and there have a growing attention on the SMEs development. On the contrary, the shortage of capital supplies and lack of financing channels have baffled the development of SMEs in practice.This dissertation has a relatively intact viewing and deep discussing on the topic of the SME financing problem. It contains five parts:In the first charter, clearly notion of SME has been defined. And a great amount of data and charts have been given to prove the importance of SMEs on our economic growth.In the second charter, present conditions on SME investments and financings have been analyzed. The shortage of capital which faces with SMEs has been revealed considering with the constraint of immediate and mediate financing and with formal and informal financial marketIn the third charter, the problem for SMEs financing has been analyzed on the point of view of inner and outer reasons. The inner reasons, as we analyzed, are the main causations. It is the missing of credit,ambiguous property right and the risk concerned that make the financial institution prudent to provide SMEs with money. The market system reform of financial system and the country's development strategy of state-owned enterprises (SOEs) make SMEs in the inferior position of credit supplying. And the outer reasons make this problem serious.In the fourth charter, efficient policies for the supporting of SMEs financing have been analyzed. And discussion of legislation protection,foundation of special administering department and financial institution,giving preferential policy,creating the credit guarantee systems for SMEs and encouraging the immediate financing in the capital market have been given.The fifth charter discus the feasible policies to build and perfect SMEs finance supporting system in our country. Based on the above analysis, the solution to this problem should include the following parts: Fundamentally foster awareness of the credit, establish a sound credit evaluation system for SMEs, play to the functions of the government, establish and improve a mechanism of mutual trust between SMEs, clear definition of government functions, establish a nongovernmental credit guarantee system, with the government policies assurance and leading, build the mutual credit system, develop regional financial center, foster and develop the feasible money supply system.