China Project Development Facility China Project Development Facility project is to establish a facility to develop viable small and medium sized private sector enterprises in the interior of China with an initial focus on Sichuan province. It is part of a broader initiative consisting of two complementary components: (i) the CPDF, and (ii) a Sichuan Investment and Credit Guarantee Company (SIGC), which is being processed simultaneously. The emphasis of the initiative is on reaching SME clients in a more cost-effective way, by channelling assistance and financing through intermediaries.   The facility would have three closely linked and complementary programs:    (A)	   Enterprise Level Support    (i) to assist the preparation, structuring, implementation and monitoring of investment projects; (ii) in the context of project work, to provide technical assistance to individual enterprises to overcome internal governance constraints to their development.    (B)	   Capacity-building & Private Sector Policy Work    (i) to develop local managerial and SME support services capacities through training and institutional strengthening, targeted at groups of small business managers, industry associations, local banks, accounting and consultancy companies and related support agencies; (ii) to advocate and support improvements in the business environment for SMEs development through studies and seminars on key areas such as property rights, corporate governance, and SME financing.   (C)	   Collaboration with the SIGC    (i) to strongly support and complement the operation of the    SIGC   , targeted at companies assisted under Program A and other companies which qualify; (ii) to work closely on the preparation, structuring, implementation and monitoring of investment projects with SIGC''s Participating Banks (PBs) and in this context provide PBs with capacity-building services in the areas of project finance, risk and portfolio management.          IFC''s role:    IFC designed the project concept based on an extensive analysis of the environment for private sector development in China and Sichuan, and in response to the country''s priorities to stimulate SME development, especially in the interior provinces of China. The project would benefit from IFC''s strong record in Sichuan and the accumulated knowledge about the province over the last six years. CPDF will be managed by IFC and as such will benefit from IFC''s experience in implementing and managing project development facilities. CPDF will be IFC''s 6th project development facility and incorporates the best practices in the existing facilities. Further, with the creation of the global SME department, IFC would be able to provide this and the other facilities with greater administrative and technical support and would facilitate transfer of knowledge and best practices among the existing and new facilities.      Developmental impact:    The private sector in China is at a critical juncture in its development: first, constraints such as inadequately developed formal business planning and management skills, poor accounting practices, and difficult access to bank loans and equity, are preventing enterprises from taking full advantage of expanding opportunities in the context of a more benign official attitude to private sector development; second, the prospects of WTO membership portend both benefits of globalization and challenges of increased competition. Through its activities for enterprise level support, capacity-building, and dissemination of best practices, the facility will work towards alleviating these constraints to private SME development. In the process, the facility would be building a sustainable local capacity to deliver the type of services CPDF would be providing.  By focusing its impact on a relatively poor interior province, the facility would be part of the larger effort to redress the growing regional disparities between the coast and the Interior.