The Government’s Guidance

    For a populous country like China, the private entreprise sector is significant for growth, not only in terms of promoting economic development, but also in solving the nation’s unemployment problem.

    The figure 1.3 billion is intimidating for any administration. Of rural China’s 900 million population, around 200 million have left their hometowns in search of work in cities; but that still leaves the majority at home, either unemployed or semi-employed. The urban areas were not much better by the end of 2008; they too stared at unemployment figures exceeding 8 million, shuddering at the thought of 1 million university graduates joining them each year upon graduation.

    The situation has been the major impetus for prompting the Chinese government’s push for private enterprise. The primary driving force was the revision of China’s Constitution specifying the inviolability of private property. In addition, the central government continues to encourage college graduates to take on official posts in rural areas, a move that relieves some of the unemployment pressures for college graduates. In return these college graduates are asked to assist local farmers in initiating their own businesses. The General Office of the State Council has carefully rolled out a series of grants and subsidies to help returning migrant workers to become self-employed. In early 2009 the Ministry of Human Resources and Social Security listed 86 cities as the first group of state-level “Enterprising Cities,” packaged with small-sum secured loans for entrepreneurs in those cities. Statistics showed that in the second quarter of 2009, the 86 cities issued RMB 17.1 billion in such loans to 1.59 million private start-ups that created 2.12 million jobs.

    Local governments around the country have begun rolling out similar supportive measures for new start-ups in tune with their local conditions. The government of Anhui Province, for example, has helped build 253 new business incubators scattered across almost every county and district in the province, with the stipulation that each incubator provides at least 200 job opportunities. In June 2009, the government of Sichuan Province allocated RMB 50 million to sponsor college graduates to hang out their shingles. The government of Nanjing, capital of Jiangsu Province, has pledged to help the 10,000 home-based businesses started by its unemployed citizens each year, in the form of social security subsidies, secured loans and tax exemptions.

    Joint Efforts from Society

    Some well-known enterprises and public institutions are eager to take up the baton of social responsibility. The Communist Youth League of China and All-China Youth Federation jointly launched the Youth Business China project, aimed at assisting the nation’s youth in growing their own businesses. The project, modeled after the Youth Business International program in Britain, will mobilize resources from all sectors of the society but primarily the industrial and commercial circles, to offer assistance in terms of information, capital and technology to bootstrap new start-ups.

    Funded by businessmen from Zhejiang Province, a business incubator for college graduates is under construction in Hangzhou. Upon completion, it will be the largest park in the city’s economic and technological development zone. At 23,000 square meters, it will be capable of housing 200 companies. Additionally, many top enterprises have gone ahead with their own assistance programs. Lenovo offered financial aid to college graduates or young entrepreneurs. In September 2009, Kaifu Lee resigned from his position as vice president of Google and Google’s China chief to start a new incubator called Innovation Works, providing a business platform with capital of US $800 million specifically to nurture a new generation of Chinese innovators.

    In such an atmosphere, Chuangye Yingxiong Hui (Entrepreneurial Heroes Meet), a TV program produced by China Central Television, was bound to score high audience ratings. The program premiered on January 1 2009 during prime time, designed to help young people learn the art of launching new businesses that will offer employment to others. Five top-drawer Chinese entrepreneurs, namely Yin Mingshan, Liu Chuanzhi, Ma Yun, Liu Yonghao and Guo Guangchang, were invited to share their expert opinions and discuss the complex process of launching enterprises with the young participants. On top of that, the program broadcasts stories of real start-up experiences from around the country to inspire other young Chinese innovators.

    Several other local TV stations followed suit and produced similar programs. Among them, Call Me Boss, broadcast on Shanghai’s Dragon TV, enjoys the highest ratings. This 20-episode reality television show premiered during the 2009 summer season and broadcast over four weeks, attracting 22,787 people to register for participation. Twenty individual winners shared the start-up fund of RMB 20 million.

    The List of the Nation’s Wealthiest College Graduates with their Own Business issued jointly by the Chinese University Alumni Association (CUAA) website and 21st Century Talent Report showed in its June release that 90 percent of those listed had raised funds independently, and nearly 50 percent amassed wealth exceeding RMB 10 million. Most of the young business stars were born after 1980.