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HKPC Survey: SMEs Optimistic but not Without Worries

Local SMEs expected average turnover growth of 2.5% for 2008 as 81% expressed optimism on the long-term business climate, according to a survey conducted by the Hong Kong Productivity Council (HKPC) in November 2007.

However, commenting on the findings of the "Business Operating Environment Index for SMEs" survey for the fourth quarter of 2007, Dr Vincent Li, General Manager (Productivity Training Institute) of HKPC, said many were worried about the short-term climate. "High fuel costs, interest rate fluctuations, the Mainland's new policies on processing trade, environment and corporate taxation, as well as the US subprime mess have seriously undermined the confidence of SMEs. The overall index fell sharply from 12.7% in the last quarter to 5.8%," he said.

In addition, the SMEs identified increasing competition from Mainland enterprises, growing national demands for environmental measures and the new processing trade policy as the three most crucial Mainland factors that affect their operation.

"To help SMEs address their concern, HKPC will provide formal one-stop service to help companies transform their business practices and upgrade their business models and modes of operation," Dr Li said.

The "Business Operating Environment Index for SMEs" survey, initiated by the HKPC in 1998, is conducted quarterly to gauge the views of Hong Kong's SMEs. In the latest survey, a total of 552 SMEs were interviewed, of which 357 were from the services sector and 195 from the manufacturing sector.

The full report of the survey can be downloaded from the HKPC website (www.hkpc.org). For further information about the survey, please contact Ms Brenda Lam at tel. (852) 2788 6151. For other media enquiries, please contact Mr Felix Chan at tel. (852) 2788 5036 or email: felixchan@hkpc.org

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Mr Alfonso TAM
Principal Consultant (Corporate Services)
Corporate Communications
Website: www.hkpc.org

18 December 2007

Remark:
Index = % of respondents holding a positive outlook - % of respondents holding a negative outlook