China's Ministry of Finance (MOF) yesterday announced the country would earmark 3.51 billion yuan (US$511.6 million) this year to support the development of domestic small- and medium-sized enterprises.

Financing difficulty had long been a bottleneck for domestic small- and medium-sized enterprises since China started providing small mortgage loans in 2002.

The government placed helping small companies and increasing employment as one of its top priorities this year. It promised to help 10 million urban dwellers find employment this year.

The MOF said on its website the country had invested nearly 17 billion yuan through 2007 to set up six special funds to support small- and medium-scale companies.

These included a technology innovation fund, an overseas marketing fund, an agricultural science and technology application fund, a small- and medium-scale enterprise subsidy fund, a small- and medium-sized companies development fund and a small- and medium-scale firm platform fund.

In a similar development, the People's Bank of China, the central bank, announced on Monday the country's financial institutions would raise the ceiling of small-scale mortgage loans from 1 million yuan to 2 million yuan to help them better fund their businesses.