GUANGZHOU: China might abolish several fees on SMEs and exempt them from tariffs on imported equipment as part of efforts to battle the effects of the ongoing global recession, said Zhu Hongren, spokesperson for the Ministry of Industry and Information Technology, one of the CISMEF co-sponsors.

As well, 100 model industrial projects could be established and one million more management professionals trained through government assistance

"Despite all the measures that have been taken to help SMEs fend off the negative impact of the global financial turmoil, many - particularly export-oriented and labor-intensive operations in coastal regions - still face severe challenges," the official said.

"The government will release more preferential policies and tax incentives for small-profit SMEs using tariff exemptions and abolishment or reduction of administrative fees," he said.

Zhu said that the State will earmark special funds for technological improvement and innovation among SMEs while establishing a development fund and encouraging private investment in smaller businesses.

The central government's financial support for SMEs is set at 9.6 billion yuan this year, compared to 3.9 billion yuan in 2008.

"The government will further define SMEs in line with the international common practices and prioritize micro-firms in new policies," he said.

Prior to the official's remarks, the State Council announced several measures in mid-August to help tide SMEs over. Among the efforts are improvements in policy and the legal system to create a more open and fair competition environment, establishment of the Growth Enterprise Market and increased funding to assist with technological innovation, structural changes and human resources.

The government also vowed to choose some SMEs to participate in the nation's subsidized purchasing program for household appliances, agricultural machinery and automobiles in rural areas as well as the car, household appliance replacement program.

And the National Development and Reform Commission - the nation's top economic planning agency, which also a CISMEF co-sponsor - submitted several proposals to the State Council early this month to expand number of the sectors permitted to receive non-government investment.

The list includes basic industry, infrastructure, finance, education and health, and public services as sectors open to private investment.

China's massive 4 trillion yuan stimulus package has significantly boosted infrastructure construction, but modest levels of private investment has resulted in concerns about structural imbalances in the nations' economy.

SMEs in China now contribute more than 60 percent of the nation's growth in GDP, over 50 percent of the tax revenues and more than 80 percent of urban jobs, according to official statistics.