This paper examines the structure and the main characteristics of the
Chinese banking industry. In particular, the paper analyses the problematic aspects
of credit relations of small and medium enterprises (SMEs). The SMEs are facing
several problems in accessing the bank loans market, dominated by the political
and contractual weight of state-owned enterprises. However, some recent reforms
have improved the situation, a fundamental condition for additional positive
results. Nevertheless, further and more pervasive modernization efforts are needed
to consolidate these results and to develop the relationships between banks and
SMEs.
