In 2009, China's enterprises face grim challenges both from the inside and outside. Amid a sluggish market and plummeting demand, Chinese enterprises are suffering from financial strain and operational difficulties.

In order to expand financing channels and establish a financing platform for enterprises, the China Enterprise Development Finance Summit was held on June 27-28 in Beijing. The summit was sponsored by the Research Institute under the Ministry of Commerce in conjunction with other government departments, commercial banks, private equity firms and venture capital funds.

In response to the financing difficulties of small and medium-sized enterprises (SMEs), bankers presented their own opinions at the summit. The address of Liu Wenfa from the National Development Bank, Lei Jia from the Cooperative Finance Supervision Department at the China Banking Regulatory Commission (CBRC) and He Ning from Morgan Stanley Bank International (China) Ltd. won wide recognition among the attendees.

Liu Wenfa, State Development Bank: How should SMEs start

up and seek financing? Most entrepreneurs starting SMEs in China borrow money from parents and friends.

I know a cashmere sweater seller from Erdos, Inner Mongolia Autonomous Region. Many years ago, he borrowed 3,000 yuan ($441) and came to Beijing to start his business. Now he has property worth more than 1 billion yuan ($147 million).

In contrast, we can see that people were eager to invest when PetroChina Co. Ltd. was to be listed on the stock market.

Who knows how difficult it is for SMEs to seek financing? SMEs have made great contributions to the country, and in return, what has the country done for SMEs?

We have enough reason to put blame on SMEs for mismanagement and withholding information from banks. It is true that SMEs have these problems, but what has the country done for them to improve themselves?

The government has provided some support in the development of SMEs, but I don't think it is enough.

The State Development Bank (SDB), the biggest policy-oriented bank in China, has done something to support SMEs.

In the past, the branches of SDB had no right to provide loans to SMEs. Now more than 30 SDB branches are entitled to grant loans of less than 30 million yuan ($4.4 million) to SMEs.

SDB has also signed contracts with local governments to provide loans to SMEs.

Since the SDB was short on staff and rich in capital, we decided to establish provincial-level credit associations and investment companies.

In accordance with its specific policies and criteria for providing financial support to SMEs, SDB has allocated 500 million yuan ($73.5 million) or 1 billion yuan ($147 million) to those provincial-level credit associations and investment companies, and the loans will be distributed by local management authorities to different projects, the smaller the better.

The SDB has also signed contracts with various government departments and the China Youth Communist League Central Committee to support young people starting their own businesses.

Young people under the age of 40 with good projects can all apply for loans from the SDB.

Up to now, SDB has provided more than 100 billion yuan in loans to SMEs, but I still believe that we have not done enough.

Finally, I want to call for more financial support for SMEs, because they have made great contributions to the country's development.