China has subdivided small and medium-sized enterprises (SMEs) by adding a category of "micro-sized enterprises."

According to a statement of four ministries including the National Development and Reform Commission and the Ministry of Industry and Information Technology, industrial companies with 20 employees or less or those with 3 million yuan ($461,538) in annual income or less are included as micro-sized enterprises. In addition, the government also lowered the standard for SMEs.

The move is designed to better shore up the micro-businesses with more targeted favorable policies, said the statement. It is estimated that micro-enterprises account for nearly 40 percent of job creation in the country.

Zhu Hongren, chief engineer with the Ministry of Industry and Information Technology, said creating the new standard will make it easier for the government to roll out suitable support measures for micro-firms.

"Micro-enterprises" are not new to many foreign countries. The European Union, for example, defines micro-enterprises as those that meet two of three criteria and have not failed to do so for at least 10 years—fewer than 20 employees, balance sheet total below $800,000 and turnover below $800,000.

In China, a string of incentives to stimulate the micro-businesses is already underway. South China's Guangxi Zhuang Autonomous Region plans to extend subsidies to micro-enterprises started by migrant workers and unemployed urban dwellers.