The administrative managers predict a record of contests at the end of the year and a "very hard autumn"
But for the president of the Administrative Managers, Fernando Santiago, this is still a figure well below the rest of European countries, "in terms of the difficulty that companies in Spain have to present the contest." Which leads to an even more serious situation because it leads thousands of SMEs to disappear. “There are more than 100,000 companies at risk of being lost; we will reach 13,000 contests, but the more than 85,000 remaining will have difficulties to survive and are doomed to close, "estimates Santiago. "The bankruptcy procedure is a protection system for the company when it has financial, liquidity or payment problems and the new bankruptcy reform does not present access facilities for SMEs either," he adds.
The leader of the administrative managers predicts a complicated scenario due to the over-indebtedness of SMEs and the self-employed, the lack of cash and the difficulties to continue financing. “There is no profitability. Costs have doubled and small firms cannot afford to raise prices or wages for their workers », he explains. Therefore, he does not place until 2025 the recovery of a segment that represents 95% of the Spanish business fabric.
Santiago places special emphasis on the problems that continue to exist with ICO credits, above all, "in the successive periods set to extend deficiencies and repayment terms." Specifically, he points out that "it is not understood that new periods to extend terms continue to be established if it is not because there is strong pressure on the liquidity of SMEs". “It is not sustainable for banks to tell us that SMEs are not requesting the extensions with which new periods continue to be opened to extend the terms and when all the agents agree with the existence of serious liquidity problems that plague small businesses. . Someone is not telling the whole truth, and I'm sure it's not the companies or the self-employed," adds Santiago.
All in all, Santiago predicts a summer of spending euphoria among the Spanish, which will be followed by "a very harsh autumn" and a 2023 where companies will not grow. "2024 will be the year of the measures to start the comeback and until 2025 the recovery will not return."
A tough job market
The administrative managers also point out the problems that small companies continue to find in hiring. «The rise in the SMI, the contributions that are at 36% for a company... we perceive at street level is that small businessmen are concerned with the reform and that the rise in the SMI in the last two years has meant a strong growth in wages, as well as abort new planned hirings”, adds Santiago.
Despite the bankruptcy moratorium
Business insolvencies soar 25.5% in June
In June there was an increase in business insolvencies of +25.46% compared to the same month of the previous year, standing at 478 contests, according to data from Solunión. «After the end of the moratorium and the delay in the entry into force of the Bankruptcy Law, we find ourselves before a scenario with a strong acceleration of insolvency proceedings, as a result of the high number of companies that have been holding on artificially. For this reason, it is essential that the entry into force of the new Law, which aims to anticipate; the promotion of early restructuring processes of viable companies, avoiding bankruptcy declarations, in order to ensure their continuity; as well as the relaxation of the exoneration of debts to insolvent entrepreneurs or individuals, favoring the second chance”, indicates Nieves Mendoza, director of claims and recovery of Solunion Spain.
