Survey of the Yangtze River Delta: cyclical contractions in SMEs

Why have tightening policies inevitably led to SMEs periodically falling into the "money shortage"? Why are big companies and big projects always getting the best sources? Why is the development of grassroots financial institutions always faltering?

These problems continue to plague people. Economists believe that these problems are related to the dual structure of finance. According to the definition of economists, the dual structure of finance means that formal finance and informal finance coexist. However, in China’s special economic structure and financial system, the financial dual structure is naturally linked with the nature of the enterprise. Large companies and state-owned economies are more favored by formal finance within the recipient system, while private enterprises and SMEs often have only Grassroots financial linkage.

In order to explore the dual structure of finance, we conducted in-depth interviews on the structural contradictions and phenomena brought about by the dual structure of finance to analyze the underlying causes of these contradictions and find possible ways to resolve these contradictions. Since the beginning of today, we will continue to introduce the series of “Perspective of the Dual Structure of Finance” phenomenon. Please pay attention to the readers.

The collapse of the enterprise is now Dongguan. A few days ago, the local senior toy company “Su Yi” and the textile company “Ding Jia” suddenly went out of business, and the “cold stream of manufacturing industry” in the Dongguan industry once again invaded. The industry believes that due to the rise of ***, wages, rising raw materials, these three factors are difficult to eliminate in the short term, the cold current may be even more than in 2008.

In Wujiang City, Jiangsu Province, this well-known textile industry gathering area, the owners of small and medium-sized textile enterprises complained: Some small companies are struggling to survive under the pressure of high raw material and labor costs, squeezed profit margins and rising costs. Some chose to suspend production. Some borrowed the *** and did not know when they could support it. There were also a few capital chain breaks and bankruptcy.

The "Economic Information Daily" reporter recently went to Jiangsu and Zhejiang provinces to learn that although the contribution of SMEs to employment accounted for 85% to 90%, their financial support was seriously out of touch. Originally in the normal economic environment, SMEs were faced with the problem of difficulties. As soon as they encountered policy tightening, it became even more difficult for them to face difficulties. “Whether it is now, or in 2008 or 1998... At the time when historical austerity policies appeared, the first “sacrifice” was always for SMEs.” Guo Tianyong, professor at the School of Finance at Central University of Finance and Economics, said in an interview with “Economic Information Daily” China's SMEs are suffering from a cyclical "deflation syndrome," and the root cause of this phenomenon is China's increasingly prominent "binary structure" of financial structure - a limited source of gold is always invested in The government tends to develop large enterprises and large projects. SMEs are inevitably periodically trapped in "money shortages."

“In the relaxed policy environment, we actively expand production and create value just like big companies. However, when we tighten, we always fall in the first batch.” In Wujiang City, Jiangsu Province, a troubled small and medium-sized textile company boss The reporter said.

“From 2009 to 2010, textile companies were madly increasing their investment in equipment, especially when the price of cotton (21375, 55.00, 0.26%) rose to 231,000 tons last year, and some people were lining up to buy cotton spinning machines. At that time, it was time to pay deposits. Wait for half a year to get the machine." Wen Hao, vice general manager of Jiangsu Hengli Chemical Fiber Co., Ltd. said.

Contrary to this kind of heat, it is the reduction of domestic and foreign demand under the tightening environment and the tightening of the form. Shen Bin, deputy director of the Wujiang SME Bureau, said in an interview with the media, “In terms of the chemical fiber industry in Jiangsu and Zhejiang, the new production capacity reached 60% in 2011, and our relevant statistics show that there is no significant increase in domestic and foreign demand. increase."

Pa Shusong, deputy director of the Development Research Center of the State Council, used “overshoot” to describe the situation of small and medium-sized private enterprises in a tightening environment. He said that at present, there is a high probability that China's economy will overshoot. The real capital interest rate that companies obtain from the financial system is the tight pressure that companies actually feel, not the official interest rate. From the perspective of the Yangtze River Delta and the Pearl River Delta region, the most economically viable regions, the cost of private enterprises’ access to capital is almost the same as in 2007 and 2008. However, the real economy in the current year is much stronger than that in the current year, such as GDP growth of 14.2 in 2007. %, and the external economic growth is strong. "So this part of the tightening efforts is relatively large. If you continue to use this kind of strength, it will cause a greater impact on some companies," he said.

According to information provided by a Wenzhou Banking Supervision Sub-bureau, the Wenzhou Municipal Economic and Trade Commission recently conducted a survey of corporate capital sources and found that companies that currently face tight funding have accounted for 42.9%, and the company’s funding gap averages about 10%. The ** satisfaction rate is only 57.4%.

On the one hand, monetary policy is continuously tightening, and on the other is the hunger and thirst for small and medium-sized enterprises. This makes SMEs' funding sources more biased towards private lending.

According to a sample survey of 350 companies conducted by the Wenzhou Financial Office, at the end of the first quarter, the proportion of self-owned funds, banks, and private loans was 56:28:16. Compared with the same period of last year, it dropped by 2 percentage points, and it dropped by 4 percentage points compared with the beginning of the year. The proportion of private lending has gradually increased, which is 6 percentage points and 4 percentage points higher than the same period of last year and the beginning of this year. This has led to a shift in the direction of capital flows and banks.

“In this case, the capital chain of small enterprises is relatively more vulnerable.” Zhou Qingming, chief supervisor of the Bank of China Branch of Wenzhou City, said that the recent large amount of funds for SMEs has increased the difficulty of financing, and financing costs have generally risen. Enterprises should The withdrawal period of accounts receivable has been extended and the cash flow has become tight.

In view of the main role of banks in China's financial system, they have an irresponsible responsibility for the "crisis syndrome" of small and medium-sized enterprises. Although banks often publicize their credit support for SMEs, they say that one set and one set are limited. The credit line in the tightening environment always flows to large corporate customers and government projects with a more obvious tendency.

“When we went to Zhejiang’s banking industry and researched, we found that the number of SME customers who came to the bank for borrowing in the first half of the year was two to three times that of last year, and banks’ lending was more cautious than last year.” Professor, School of Finance, Central University of Finance and Economics Guo Tianyong told the "Economic Information Daily" that although SME financing is a common phenomenon in all countries, China's response is now more prominent.

According to a recent sample survey of 350 SMEs by the Financial Office of Wenzhou City in Zhejiang Province, 18% of the company's capital chain is very fragile and may become the object of bank loans. At the same time, the number of 25 small and medium-sized growth enterprises from banks was only 133 million yuan, accounting for 18.5% of the total of 24 key enterprises in the country.

“Now banks require corporate lending to come into the bank immediately, and then use the CD as a mortgage to re-lend once, which makes the cost of corporate financing double, the annual interest rate is about 12 to 13%. The average profit of a company is no more than 10%, and it can't afford such a high cost of capital. For banks, their risk is even greater." The above bank account manager told reporters.

Why did economic policy tighten and private and small and medium-sized economies suffered? Private and grassroots financial institutions are always excluded from development?

Guo Tianyong believes that this is the pain that must be experienced in the process of economic growth in developing countries, and the breakthrough is the timely transformation of the role of the government. Guo Tianyong uses financial repression theory to explain the intrinsic reasons for SME contraction syndrome: financial repression prevails in developing countries. In the stage of economic take-off and catch-up, the government plays a more important role. It needs to control the limited sources of financial resources. Put money into industries and projects that the government tends to develop.

“As a result of financial repression, the government has to minimize the cost of obtaining funds for state-owned and government projects, and therefore has a certain level of suppression on the interest rate of financial institutions. This creates a gap between the actual interest rate and the nominal interest rate of financial institutions. Private and small and medium-sized economies that are in line with government projects and government investment goals can only withstand higher real interest rates; at this stage, the development of private and grassroots financial institutions that serve the latter is also necessarily excluded—the financial dual structure. Inevitable."

How to get out of the cycle of financial repression? Guo Tianyong believes that after the economy has passed the assault phase of development, government forces will gradually fade out, and the original driving force for economic growth should be handed over to the market itself, to private capital and social capital -- China's proposed adjustment of economic structure to achieve endogenous growth. This is the reason, that is, the so-called financial deepening.

“The difficulty in the process of financial repression and financial deepening is the government’s transformation.” Guo Tianyong said that the current government’s reluctance to hand over batons is complicated: First, the government tends to think that it is more efficient than the market; Second, the government Concerned that once it let go, the economy will collapse; Third, the government power to hand over the baton will be greatly weakened, can not be in a strong position ... These are the factors that make China's financial dualistic structure unresolved.