Ernst & Young: 90% of small and medium-sized enterprises expect to grow more than 6% in the next year

Ernst & Young recently published a survey report, reflecting that over 90% of local SMEs surveyed are confident that their growth in the next 12 months will be at least 6% or more. Nearly 40% of respondents plan to expand their business to other markets in the Asia Pacific region. However, nearly half of the respondents also said that insufficient capital flow will become the biggest obstacle to business development. Ernst & Young’s report shows that SMEs in Hong Kong are optimistic about short-term economic development, with 61% of respondents expecting a growth rate of at least 6% to 10% in the next year, an increase of 23% over last year; 31% of respondents I believe that the company’s growth can achieve double-digit growth.

The survey also shows that bank lending is still the preferred way for SMEs to obtain funds. 46% of SMEs surveyed will consider bank loans, which is higher than China (33%) and the rest of the world (37%). Chen Rihui, an equity partner of Ernst & Young’s audit, warned that even if the bank’s interest rate is not high, companies still need to pay attention to interest costs.

Chen Ruijuan, managing partner of Ernst & Young Hong Kong and Macau, believes that although the market is facing the gloom of Sino-US trade wars, the strong performance of the retail industry, coupled with the growth of tourism and the decline in unemployment, have prompted SMEs to be very optimistic about future growth.

Ernst & Young’s survey was held from January to March this year, and interviewed 102 senior executives from the company with annual income ranging from 7.8 million to 23.4 billion yuan. The industry scope includes retail, financial services, real estate and entertainment.