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Help on the way
2/5/2020



A sanitation worker sprays disinfectant in a public area in Beijing on Tuesday. Photo: cnsphoto


China's local governments and e-commerce platforms are moving to reduce rents and offer financial support to help small businesses tide over the novel coronavirus outbreak.

Starting on Sunday, cities including Shanghai, Beijing, Qingdao and Suzhou have rolled out policies to support small and medium-sized enterprises by reducing their burdens of loans, rent and social security payments.

The city of Beijing has extended the collection period of social insurance premiums to the end of July for companies in tourism, catering and other hard-hit industries, allowing them to delay their payment during the novel coronavirus epidemic.

Suzhou in China's major export province Jiangsu has asked banks to increase financial support to small and micro-enterprises. It also said small and medium enterprises leasing state-owned properties will have their rent waived for one month and halved for another two months.

Meanwhile, Suzhou, Shanghai and Qingdao have proposed to return half of the unemployment insurance premiums paid in the previous year to employers that do not lay off workers.

 The slew of supportive policies came as experts warned that small businesses, a major force in the job market and livelihood-related services, are more susceptible to the virus's economic repercussions.

"Medium, small and micro-sized enterprises are major contributors to job creation. Supporting these enterprises will help prop up employment and protect economic vitality," said Xiao Zhixing, professor at Peking University HSBC School of Business.

In a meeting Monday, the Standing Committee of the Political Bureau of the Communist Party of China Central Committee stressed that supportive policies for enterprises and employment should be well implemented while enhanced efforts will be made to keep major sectors of the economy stable.

Credit support for the manufacturing sector, small and micro-enterprises, as well as private firms, will be boosted, the People's Bank of China said Saturday in a circular released with other departments.

On the market end, e-commerce platforms and market heavyweights are also ramping up their support for small businesses.

Alibaba-backed Internet bank MYbank said starting from February 2, the interest on loans will be cut for 1.5 million shops and 300,000 pharmaceutical shops in the epidemic epicenter Hubei Province. Small shopkeepers who contract the new coronavirus will enjoy interest exemption.

Huazhu Group, one of China's largest hotel operators, announced it would halve franchise fees for all affiliated hotels nationwide from February 1 to March 31. Those in the locked-down areas of Hubei will have franchise fees waived during the period, it said.

Online food delivery and ticketing services platform Meituan Dianping also said all take-out businesses in Wuhan, capital of Hubei where most cases were reported, will have one month's commission exempted.

The support may come as a godsend to many struggling small businesses.

Zhou Qingsong, who operates a hotel with 40 employees in east China's Zhejiang Province, said their business volume has plummeted by 95 percent as many guests chose to stay at home to reduce infection risks during the Spring Festival, an otherwise peak travel time.

"Excluding rent, our daily staff salaries, utility bills and other expenses are between 12,000 and 13,000 yuan ($1,714-1,857). If this situation continues for 2-3 months, the hotel's cash flow will be under great strain," Zhou said.

Chen Hongmei, who owns a small restaurant in Wuhan, said while the number of guests has dwindled, the takeout orders she has received have surged.

"I'm happy about my decision to stay open so I could be helpful during this hard time," said Chen, whose eatery now handles over 100 takeout orders every day, including lunches for medical staff of nearby hospitals.

Ji Qi, the founder of Huazhu Group, promised to avoid layoffs and salary cuts in a call to hotel owners and encouraged them not to yield to the temporary difficulties.

"After SARS, China saw a boost in travel and consumption, which brought an unprecedented boon to many hotels. As long as we join hands to face the challenges, victory will be waiting for us," Ji said.

Lian Weiliang, deputy chief of the National Development and Reform Commission, said at a recent press conference that the new coronavirus epidemic will only have a temporary impact on China's economy, and the country's good economic fundamentals for long-term growth remain unchanged.  


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