ASSESSMENT STUDY OF THE ROLE OF THE CHINA GOVERNMENT IN THE FINANCING OF SMALL AND MEDIUM-SIZED ENTERPRISES

Abstract

The purpose of this study is to highlight and then provide the solution of financing barriers for (SMEs) of China as they are the backbone for open markets. Small and medium-sized enterprises act as a catalyst for economic growthbut on the other hand lack of finance slower down operational activities of (SMEs). This study attempts to find out the most important constraints faced by Chinese (SMEs). Field research and descriptive analysis are used in order to identify main constraints in terms of finance faced by Chinese (SMEs) in this research. On the other hand different the role of different credit institution also analyzed in the research. Based on our analyses we suggest that financial institution are capable to bring financial credits innovations for (SMEs), thus government should guide them properly. It is necessary that public and private financial institutions develop a single financing framework which helps to reduce financial constraints for (SMEs)’s, further more, it is also a great need of multi-level credit guarantee system for (SMEs)for tackling down their day to day business operations.