In Bucharest, decisionmakers are taking measures to restart the economy.
Romania’s economy will emerge from this crisis with a different structure, but more efficient and more competitive, the finance minister Florin Cîţu believes. According to him, measures to support production capacities have been taken from the very beginning.
For SMEs, heavily affected by the corona crisis, a programme called IMM Invest has been initiated, designed to provide funding for current operations or for investments by means of state guaranteed loans.
Originally launched on April 17, the platform crashed immediately as hundreds of thousands of users tried to access it per minute. On April 28, the IMM Invest platform, now operated by the Special Telecommunications Service, was once again operational. And nearly 20,000 entrepreneurs applied online from the first hour of operation.
But funding will not be granted on the first come, first served algorithm, as the honorary president of the National SME Council, Ovidiu Nicolescu, explains:
Ovidiu Nicolescu: “An applicant has to prove its capacity to use this money in a productive, profitable manner, and that it will be able to repay the loan. Amounts will not be broken down by economic sector, there would be no point in doing so.”
The president of the National Guarantee Fund for SMEs, Dumitru Nancu, also warns that it will be up to banks to decide which applications will be approved:
Dumitru Nancu: “A total of 22 banks are taking part in this 15-billion lei fund. The bank will be the one that will analyse whether the entrepreneur—the small or medium enterprise—is creditworthy, according to the bank’s own rules. Once a loan is approved, the request is forwarded to the Guarantee Fund, which covers 90% of the loan guarantee.”
The government covers 100% of the financing costs, and the amounts that can be applied for are substantial. Entrepreneurs may apply until the end of the year and until the earmarked budget of around 3 billion euros is used up.
The programme is backed by all political parties, and the emergency order regulating the operation of IMM Invest was passed by Senate on Tuesday without major changes.
Meanwhile, the Ministry of Economy, Energy and the Business Environment approved a 3-month extension of the application period in a programme called Start-Up Nation, to September 28, 2020 at the latest.
The ministry explained that the decision is aimed at mitigating the economic impact of the restrictions introduced during the state of emergency on the SMEs accepted into the Start-Up Nation programme. Currently in its 3rd year of implementation, Start-Up Nation is an initiative under which the government supports newly-established businesses.
(translated by: Ana-Maria Popescu)