Chinese small and medium enterprises are facing more difficulties this year than they did in 2008, an industry association said on Monday.

The global economic downturn and China's economic slowdown are the main reasons behind the problems, said Li Zibin, president of the China Association of Small and Medium Enterprises.

The production and operation conditions of SMEs remain lackluster, the association said.

Rising costs of raw materials and labor, fund-raising difficulties, and the appreciation of the RMB, which is reducing export orders, also led to the situation, Li added.