China’s GDP growth increased by 4.9% year on year in the third quarter of 2020, although that was lower than the 5.2% expected by economists. After effectively overcoming the most serious novel coronavirus pandemic, China was the first country to rebound. The International Monetary Fund expects China to be the only major world economy to grow by 1.9% this year. Earlier, the China Association of Small and Medium Enterprises announced that the SME Development index (SMEDI) in the third quarter was 86.8, up 1.3 points from the second quarter. After bottoming out at 82 in the first quarter of this year, the SME Development Index has rebounded for two consecutive quarters. Among them, the sub-sector index rebounded across the board, and seven of the sub-indices rose and 1 fell. However, the China Association of Small and Medium Enterprises stated that small and medium-sized enterprises are still facing many difficulties in production and operation, and their burdens are still heavy. Problems such as financing difficulties, rising costs, insufficient orders still exist, and operating pressure continues to increase. In view of the financing difficulties of enterprises, although major banks have clear and specific financing indicators for financing small, medium and micro enterprises, the financial service departments of banks still face the contradiction of increasing loans and rising bad debts. Mr. Prasad, the Cornell University professor, said that one of the key issues for China’s sustained prosperity and development was not only to provide credit, but to put it in the hands of the more dynamic SMEs in the economic production activities. That will not only lead to better employment growth, but also increase productivity, which is crucial for growth in China and Asia. Steve Cochrane, Moody's Chief economist for Asia Pacific, agrees that any future stimulus must focus more on small and medium-sized enterprises, which are the dynamic parts of the economy that can really work to continue to grow and diversify.