Capital Market Financing for SMEs: A Growing Need in Emerging Asia

Date: January 2014
Type: Papers and Briefs
Subject:
Series: Regional Economic Integration Working Papers
Author: Shinozaki, Shigehiro

Description

How can Asia's small and medium-sized enterprises (SMEs) access finance? The rapid growth of emerging Asia is generating SMEs’ long-term funding needs and requires robust capital markets as an alternative channel for providing their growth capital. The G20 Leaders also addressed the importance of promoting long-term financing for SMEs in the context of investment.

The development of capital markets that SMEs can tap into is one of the policy challenges under the pillar of diversified financing modalities, which requires more sophisticated and innovative institutional arrangements in order to respond effectively to their real needs.

About this paper

This paper explores the potential of capital market financing for SMEs in emerging Asia, reviewing the challenges of existing SME capital markets and assessing demands on SMEs, regulators, policy makers, market organizes, securities firms, and investors for developing an SME market, based on the findings from intensive surveys.

Given the responses to the national growth strategies and the cross-cutting issues of global policy agendas such as climate change, energy efficiency, and green finance, the potential for developing the exercise equity market and the social capital market in Asia is also explored in this paper.

Contents

  • Abstract
  • Introduction
  • Landscape of SME Capital Markets in Asia
  • Potential for Developing SME Capital Markets
  • New Modalities of SME Capital Markets
  • Conclusion
  • References