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Roberto Savio, founder of International Development Information Organization, has an interview with Chinese media during the forum on governmental policies and plans for the world economy held at Shanghai Jiaotong University on Sunday. [Photo provided to chinadaily.com.cn]

SHANGHAI -- Efforts are needed to apply innovation concepts and high technologies to stimulating China's small and medium-sized enterprises for the fast economic expansion, said Roberto Savio, founder of International Development Information Organization (DEVNET).

"More funds should be injected into those enterprises to launch innovation and R&D projects rather than just into infrastructure facilities," said Savio, who is also special advisor of the Board of Directors of DEVNET International.

Savio made the remarks at the forum on governmental policies and plans for the world economy which was held at Shanghai Jiaotong University on Sunday with more than 150 experts, scholars, professors, entrepreneurs and students in attendance.

"The increasing foreign investments have provided opportunities for local enterprises to apply their innovation concepts to their effort to produce high-tech products," he said.

At present, average expenditure, which has been spent on R&D of local small and medium-sized enterprises, accounts for only 1.2 per cent of their annual budget. "It is not enough, leaving a big gap from their counterparts in developed countries," he said, adding that the percentage should be increased to at least 2.5 per cent.

Savio set up DEVNET in 1985 as its chairman, which aims to promote the cultural, technological, economic and trading exchanges of developing countries with developed countries, technology transfer and economic cooperation between them.

This is his seventh tour of China. "I like China and I am very interested in its development," he said, adding that he will visit DEVNET branches in some provinces after his tour of Shanghai.

"China has to look at the world transition and face internal and external challenges, but they are well within its abilities to overcome," he told participants at the forum.

"Internally," he said, "it has to bring banks more at the service of investors than through low interest rates concentrate capital on big projects. It has to stimulate internal market and reduce the disparity between the coast and interior."

As regards to enlarging internal market, Savio said three conditions will be needed: firstly, giving value of bank deposit; secondly, giving financial support to small and medium-sized enterprises, and thirdly, investing more in the interior.

"Interior areas are now lack of investments for fast development. New policies are needed to solve the problem," he said.

Externally, the country must dedicate more priority to high quality and high technology products as other Asian countries are doing to challenge a constant increase in labour costs, he said.