The SME Funding Schemes have brought considerable benefits to Hong Kong Small and Medium Enterprises (SMEs), local employment and Hong Kong's economy as a whole, the Director-General of Trade and Industry, Mr Raymond Young said today (April 25).
Mr Young said the SME Funding Schemes, set up by the Government to help SMEs secure loans for acquiring business installations and equipment, expand overseas markets, upgrade human resources and enhance overall competitiveness, have been well received by the industry. The funding provision and government commitment for the schemes amounted to $2.2 billion and $12 billion respectively. Over $ 8.3 billion of Government guarantee or grant have been approved so far and nearly 50,000 SMEs directly benefited from the schemes. SMEs of all sectors can also be benefited from the projects funded under the SME Development Fund (SDF).
"There are currently around 50 lending institutions participating in the SME Loan Guarantee Scheme (SGS). The Government has approved $7.3 billion loan guarantee, generating $16.3 billion loans from the participating lending institutions. On average every SME making use of the SGS receives about $2 million from lending institutions.
"The loan guarantee has helped over 8,300 SMEs to acquire business and equipment loans and working capital loans from lending institutions to enhance business growth, creating about 3,700 new jobs for Hong Kong", Mr Young said.
As regards the Export Marketing Fund (EMF), the Government has provided cash grants, totaling $615 million, to over 15,000 SMEs. Noting that over 27% of the beneficiaries are SMEs which have only been established for less than three years, Mr Young said it showed that the scheme was conducive to business starters.
Mr Young said the Trade and Industry Department (TID) had commissioned the Hong Kong Polytechnic University to conduct a survey on the effectiveness of EMF last year. The study revealed that over 85% of the respondents considered that EMF had encouraged them to participate more actively in export promotion activities. About 66 % of the responding companies said the EMF offered them practical assistance in expanding overseas markets.
The EMF has also had a positive impact on the labour market. The study by the Polytechnic University and TID statistics both showed that the Scheme had helped generate close to 10,000 local job opportunities.
SDF provides a platform to leverage the resources of non-profit distributing organisations in addressing the needs of SMEs. The Government has so far granted about $100 million in subsidies to 87 projects carried out by not-for-profit support organisations, trade and industrial organisations, professional bodies and research institutes to enhance the overall competitiveness of SMEs. The projects cover all sectors of the SMEs. About 33% of the approved projects target SMEs in general; 27% of the approved projects target SMEs in manufacturing sectors; and 40% of the approved projects target SMEs in non-manufacturing sectors.
"The Government strives to provide a friendly environment for conducting business. The TID has always been closely monitoring the economic situation and introduce new measures to help enhance SMEsíŽ productivity and competitiveness. Among them, the application procedures for EMF were simplified last year and the SDF is now receiving applications throughout the year earlier. The TID will continue to work closely with the Small and Medium Enterprises Committee (SMEC) to review the SME Funding Schemes and map out new initiatives to support SMEs", Mr Young said.
The Chairman of the SME Committee, Mr Chan Wing-kee said SMEs was the backbone of Hong Kong's economy. He hoped the Government could consider injecting new funds to support the continual operation of the three schemes in the years to come.
Ends/Tuesday, April 25, 2006
Issued at HKT 19:28