The resumption of dine-in services starts in an orderly manner in Shanghai on June 29, 2022 after it was suspended for about three months. Photo: Bai Qi/Global Times

Shanghai has announced its first relief policy for more than 500,000 troubled business owners, who account for 15.7 percent of the city's market entities, to reduce their production and operation costs and improve their business environment.

Chen Yanfeng, deputy director of the Shanghai Municipal Administration for Market Regulation, said at a press conference on Tuesday that the city's 507,700 individual businesses face an unprecedented predicament caused by the Omicron lockdown in April and May, and the importance and urgency of helping the businesses to revive their confidence and stabilize their operations have never been greater.

"Shanghai's economy can only rebound faster by helping all small and medium-sized market players, including individual entrepreneurs. We need to address their difficulties and create a good market environment for them," Chen was quoted as saying in an interview with local media Yicai.

Affected by the pandemic, the city's individual businesses face headwinds including expensive labor, rising production costs, liquidity crunch and operational difficulties, Chen said.

The market regulator announced 16 measures to reduce the companies' costs, including tax incentives, rental reductions and utility subsidies.

In terms of financial support, Cao Guangqun, deputy director of the Shanghai Office of the China Banking and Insurance Regulatory Commission, said on Tuesday that the office has enhanced credit allocation to support the stable operation of small and micro-sized enterprises.

According to Cao, as of end-June, Shanghai's average loan interest rates for micro-sized and small market players stood at 4.92 percent, one of the lowest in the country.

The balance of inclusive loans by financial institutions exceeded 790 billion yuan ($116.3 billion), up 70 billion yuan over the beginning of the year and a year-on-year rise of 22 percent. Among them, the balance of inclusive loans for individual entrepreneurs reached 32.5 billion yuan, an increase of 14 percent year-on-year, extended to 330,000 borrowers.

Domestic banks in the city extended 117.9 billion yuan in relief financing, covering a total of 37,800 borrowers while providing employment support for as many as two million people.

Global Times