New national SME development fund launched
China Small Medium Enterprises Development Fund Co. Ltd, a joint venture launched by China’s finance ministry and the Ministry of Industry and Information Technology (MIIT), opened in Shanghai on Thursday.
The fund will enlarge private equity investment to small- and medium-sized enterprises (SMEs) through direct investment in quality projects as well as financing through sub-funds.
Wang Jiangping, vice minister of the MIIT, said: “this is an innovation in utilizing government finance to support SMEs, which will also improve the effectiveness of government finance.”
The joint fund was established in Pudong New Area, Shanghai on June 22 with a registered capital of 35.7 billion yuan (US$5 billion).
The Ministry of Finance has poured as much as 15.25 billion yuan into the joint venture, giving it a 42.66 percent stake. The remaining stake is contributed by 14 investors including China Tobacco, China Life Insurance, The People’s Insurance Company (Group) of China, Minsheng Royal Asset Management and Guosheng Group.
So far, the country has slashed nearly 820 billion yuan in fees for SMEs by cutting some social insurances, tolls and electricity costs. The cost relief for SMEs is expected to be more than 2.5 trillion this year, according to the MIIT.