The National and International Expansion of Chinese SMEs. Evidence from Anhui Province

Purpose - Purpose: the paper aims to study the national and international expansion of SMEs from Anhui, China. The study focuses on the interaction of SMEs with the Government assessed through the development of specific industries as well as ownership and funding by the State, and the origins of the relative weakness of Chinese SMEs’ competitive position.
Design/methodology/approach - Design/methodology: the data was collected from 154 SMEs and analysed using multivariate regressions; the models used the firms’ export intensity at the regional, national, and international level as dependent variables. Seven models were run: the first analysing the industry where SMEs operate, the second and third studying state funding and ownership, and the last four analysing a set of barriers hindering firms’ expansion as independent variables.
Findings - Findings: the results show that: a) SMEs operating in labour-intensive industries have better access to international markets, b) ownership and/or funding by the state do not play an important role in regional, national and international expansion, and c) 11 barriers related to weak management skills and knowledge are hindering the expansion of Anhui’s SMEs. The findings are then analysed vis-à-vis recent works on Chinese firms and conclusions are drawn.
Originality/value - Originality/value: the paper contributes to the increasing body of literature on the expansion of Chinese SMEs by providing an empirical analysis in a region different from the increasingly studied coastal areas.