German software company SAP SE will focus on small and medium-sized clients to grow its cloud business in China this year, after it posted its best-ever financial year in the region in 2016.

SAP's China branch announced on Wednesday that it saw triple-digit growth in its cloud business and a double-digit rise in its software and software-related service last year.

Mark Gibbs, president of SAP Greater China, said small and medium-sized enterprises will offer huge growth potential as they deploy cloud technology amid the economic slowdown.

"Small enterprises abound in China and they are the fastest-growing group in the world. They will be medium-sized companies tomorrow and big clients the day after tomorrow," Gibbs said, declining to offer detailed financial figures.

The company also said that its local data centers can offer four new cloud solutions in China, as part of its effort to facilitate local enterprises' digital transformation. One of them is its SAP Hybris Cloud for Customer, which can help enterprises stay connected to their consumers.

As of December, SAP had around 12,000 business customers in China. Globally, its 2016 revenue grew 7 percent to 22.07 billion euros ($23.5 billion).

SAP is competing with heavyweights such as Oracle Corp and Salesforce.com Inc in the nascent yet highly promising cloud sector.

Charlie Dai, principal analyst at Forrester Research Inc, said: "Its shifted focus on small and medium-sized enterprises reflects that Chinese companies are accelerating their cloud adoption."

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