Mon, Oct 19, 2015 - Page 14 News List

China pushing entrepreneurship, small businesses

Reuters, SHANGHAI

Entrepreneur Ding Jia, 29, poses inside her D+ Cafe in Shanghai, China, on Aug. 6.

Photo: Reuters

Quitting her job as receptionist, joining rock bands and chancing her tattoo-sleeved arm at small business ventures would once have branded college graduate Ding Jia as a rebel in China. Now she can claim state endorsement as a “creative.”

“I haven’t had a formal job in years,” said Ding, 31, sitting in her tiny coffee and cocktails bar on a trendy Shanghai street.

She has no regrets, but no illusions either.

“Entrepreneurship can be a really hard experience,” she said. “Profits can be so thin.”

In the week she spoke to reporters, she and dozens of nearby businesses were forced to close temporarily by city officials on a regular sortie to enforce regulations.

While most parents might warn their children off high-risk, low-reward self-employment, preferring jobs in government or state-owned enterprises, Ding says her Shanghai nurse mother and cab driver father were supportive.

That attitude finds an echo in high places; recent graduates who start their own businesses are being hailed in state media as a new creative class that would build China’s Silicon Valley.

“Creatives show the vitality of entrepreneurship and innovation among the people, and such creativity will serve as a lasting engine of China’s economic growth,” Chinese Premier Li Keqiang (李克強) said in January. “I will stoke the fire of innovation with more wood.”

In addition to warm words, many are receiving training, subsidies, free office space and other support from district governments and universities.

Optimists hope the next Jack Ma (馬雲) or Mark Zuckerberg will emerge from this pool, but sceptics say the policy is setting up inexperienced kids for failure.

The aim is to help shift China’s factory-based economy towards knowledge-driven services, and address unemployment among Chinese college students. Most private employers have little use for fresh graduates from crowded domestic universities, who consequently can earn less than skilled factory and construction workers.

A Peking University study found that entry-level salaries in Shanghai averaged just 3,241 yuan (US$511) a month — a pittance in a city with one of world’s 10 most expensive property markets.

Chinese surveys show 20 to 30 percent of college students now aspire to entrepreneurship or self-employment, and Cui Ernan, a labor analyst at Hong Kong-based Gavekal Dragonomics, said official data suggests they are following through. Though undergraduate numbers swelled to record highs last year, the number seeking work

Cynics say pushing student entrepreneurship is mostly about helping officials meet targets while heading off political unrest among disaffected students, the demographic behind the 1989 Tiananmen Square protests.

A busy entrepreneur, on the other hand, counts as both employed and as a new business registration.

Parker Liu, currently chief operating officer of a mobile technology startup in Beijing, began launching new companies before he graduated. He said district officials regularly scoured entrepreneurship events seeking startups to subsidize, often on the understanding that the company would register in their district.

Liu said he had received small subsidies from district governments and helped introduce officials to other startups, but was doubtful about the benefits.

“The real problem is the money doesn’t come with education... These government officers, they didn’t know much about entrepreneurs or startups, but they know a lot about political evaluations. They have a quota,” he said.

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