Ministry of Industry Wants China to Create over 80,000 “Specialised and Innovative” Small Enterprises in 2023

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China’s Ministry of Industry and Information Technology (MIIT) hopes to step up the creation of innovative small-scale businesses in 2023, as part of broader policy efforts to foster the development of the digital economy and accelerate scaling of the value chain.

A source from MIIT said to state-owned media that in 2023 “efforts will be made to strengthen policies and services for enterprises, create a favorable environment for enterprise development, and promote innovation in and the cultivation of high-quality enterprises.”

MIIT’s goal is to foster the creation of 80,000 specialized and innovative small and medium-sized enterprises across the country, with plans to develop around 100 distinctive industry clusters for smaller-scale businesses.

A MIIT survey of 43,000 small and medium-sized enterprises found that nearly 40% of respondents obtained new loans in 2022, while more than 60% of enterprises invested in research and development, and over 60% of enterprises made fixed asset investments

“[This] indicates that enterprise development confidence has continued to increase,” a MIIT official said.

Figures from MIIT highlight the rapid development of small-scale innovative businesses in China, as Beijing pushes for “high-quality” economic growth and a greater role for private enterprise.

According to MIIT data, in 2022 an average of 23,800 new enterprises were founded each day, while the number of small and micro enterprises exceeded 52 million. The operating revenue of small and medium-sized enterprises above scale in the industrial sector exceeded 80 trillion yuan.

The number of small and medium-sized enterprises above scale also saw a year-on-year (YoY) increase of 10.5%, while their operating revenues and profits rose by 5.2%, and 1.1% respectively.

“A large number of specialized and innovative new enterprises have emerged as bright spots in the development of small and medium-sized enterprises,” MIIT officials said.

“China has cultivated more than 70,000 specialized and innovative small and medium-sized enterprises, including 8,997 ‘little giant’ enterprises.”

Small-scale innovative enterprises have also enjoyed greater access to financing via China’s capital market.

In 2022, specialized and innovative small and medium-sized enterprises accounted for 59% of new listings, including 72% of new listings on Shanghai’s Science and Technology Innovation Board

Over 1,300 specialized and innovative small and medium-sized enterprises have been listed on the A-share market, accounting for 27% of the total number of listed companies.

“These enterprises have deeply cultivated the industrial foundation and fully reflect the development characteristics of specialization, refinement, uniqueness, and innovation,” a MIIT official said.