The country should take more practicable and operable measures to help fresh graduates start their own businesses.

The "zero down payment" lending policy adopted by the government, aimed at encouraging graduates to jump-start their ventures, has encountered a setback in Shanghai. According to a recent survey conducted on six graduating Shanghai students, who chose start their own enterprises under the center's preferential policy, all of them failed to open business accounts in banks, even though they managed business licenses.

Under the influences of the global financial crisis, China's social contradictions involving employment have become increasingly prominent. The "zero down payment" policy was basically aimed at expanding employment channels for fresh graduates and offering them a chance to make use of their knowledge and tap their own potentials.

However, relevant State departments still need to take some comprehensive and considerate measures for the policy's smooth and effective implementation. Also, we should not pin more hopes on profit-pursuing commercial banks to play a role, which the government should shoulder.

In the context of the economic slowdown at home and abroad, this year's graduates are confronted with a particularly harsh employment environment. It is reported that by the end of March, a famous high-learning institute in Shanghai, a locomotive of China's economy, still has 30 percent of its graduating students whose working intentions remain unresolved. In the previous years, 100 percent of the institution's final year students usually found jobs by January. Worse, less than 20 percent of graduating students in some other high-learning institutes have landed job contracts as yet.

To ease growing employment pressures, the country should lower the threshold for graduates to start their own businesses, which is expected to inject a new vitality into the slowed national economy. To this end, a good policy on paper alone is not enough.

When it comes to the "zero down payment" policy, the government still needs to take workable measures to seek active coordination from relevant parties, domestic commercial banks in particular. Otherwise, the policy will be reduced to only an attractive pie, out of reach.

As it turns out, most graduates keen on setting up their businesses have encountered various hurdles in the process of opening an enterprise account, a necessary step to start a new business. For instance, all domestic commercial banks demand that any one who wants to start a business must first deposit no less than 20,000 yuan in his or her bank account, and must pay a procedure fee ranging from 2,000 to 3,000 yuan.

For the 20-something graduates, who have just left their ivory tower and have no strong economic power, such an exorbitant economic requirement is undoubtedly equivalent to an insurmountable jolt in their dream of a business venture.

In fact, commercial banks cannot be blamed for their lack of cooperation, given that their overwhelming purpose is to pursue maximum profits at low risks. Any of the existing risk evaluation systems set up by domestic commercial banks are enough to persuade them to avoid lending to economically weak graduates.

Under these circumstances, any preferential policies launched by the country's industrial and commercial authorities due to the lack of a necessary risk guaranteeing system, would prove useless.

The setback most graduates have suffered is also an essential reflection of the hardships facing the country's private-run enterprises. It is common that a large number of private enterprises have been marginalized in the country's preferential policies in support of industrial development.

A typical case is in the field of refined oil. According to a regulation promulgated by the Ministry of Commerce, the wholesale of the country's refined oil should be open to all domestic enterprises, State-run or private, as of Jan 1, 2007. But the regulation also stipulates that only those enterprises with an oil storeroom of 10,000 cubic meters and a registered fund of 30 million yuan are qualified to start such a business. The two requirements undoubtedly deprive almost all of the less powerful private oil enterprises.

As the global financial crisis continues to affect the Chinese economy, domestic private sectors' potential should not be understated anymore. The country's enormous domestic savings, as high as 24 trillion yuan, should flow to these sectors and help boost the national economy.

Developing private sectors will not only help promote a diversified market pattern, but will also contribute much to the improvement of market vitality. We should not suffocate any possibility of our young graduates becoming the next Bill Gates and Michael Dell, both of whom have set a good example for young graduates to create a new business empire after starting from scratch.

To encourage the country's youth to start their own businesses, a policy on paper or slogans without any substance is not enough. A risk guarantee fund, including risk investment and private equity, should be set up to dispel the concerns of commercial banks when extending loans to young graduates.

The author is an anchorman with China Business Network, a TV network based in Shanghai.

(China Daily April 24, 2009)