Business performance of China's small and medium-sized enterprises improved in 2023 on the back of the gradual resumption of work and production after the COVID-19 pandemic, alongside a package of supportive policy measures, the latest data showed on Wednesday.

Analysts said the improvement indicates the steady recovery of business activity among SMEs after the COVID-19 shocks.

China's Small and Medium Enterprises Development Index, based on a survey of 3,000 SMEs, averaged 89.2 in 2023, up from 88.4 in 2022, said the China Association of Small and Medium Enterprises.

However, the index declined from 89.3 in November to 89 in December. For the fourth quarter, the index came in at 89.1, from 89.2 in the third quarter.

"Despite some fluctuations, the latest figures point to a continued recovery trend," said Hong Yong, a research fellow at the Chinese Academy of International Trade and Economic Cooperation's e-commerce research institute.

"This indicates that SMEs made certain progress in development last year, driven by a steady consumption rebound, growth in services consumption, recovery in fixed-asset investments and the vigorous development of high-tech industries."

Hong said the country introduced a series of policies last year aimed at promoting growth of the private sector, which has created a better development environment for SMEs and significantly boosted their confidence.

Looking ahead to 2024, he believes development prospects for SMEs will continue to improve with existing policies taking effect gradually and more supportive measures in the offing.

China has already pledged efforts to bolster its private sector, mostly SMEs, as the National Development and Reform Commission on Tuesday held a meeting with five private companies to address private enterprises' concerns and support their sustainable development.

Zheng Shanjie, head of the NDRC, said at the meeting that the commission will carefully review the opinions and suggestions of participating entrepreneurs and establish a mechanism for cross-regional and cross-departmental coordination to solve problems.