The Chinese government said Thursday small and medium-sized enterprises (SMEs) had "an important role" to play not only in the country's economy but in society at large.

China has 42 million SMEs, more than 95 percent of which are privately owned, making up more than 99 percent of all enterprises in the country, said Ou Xinqian, vice minister of the State Development and Research Commission, in a news release.

SMEs "have become an important driving force in economic and social development," Ou said.

SMEs contribute 60 percent of China's gross domestic product and about half of the country's total tax revenue, and provide more than three quarters of urban employment.

More than 80 percent of people laid off from state-owned enterprises found jobs in SMEs which are also a key source of jobsfor college graduates, she said.

She pointed out that SMEs make 65 percent of the country's patent applications and develop more than 80 percent of its new products.

SMEs export the vast majority of China's clothes, textile products, toys and leather shoes and are increasingly involved in high-tech products such as telecom equipment, electronic and biotechnology products.

However, Ou said that SMEs had to cope with a number of difficulties, including inadequate laws and regulations, difficulty in obtaining financing and immature public services.