The end of the one-year grace period for credits guaranteed by the Official Credit Institute (ICO) brings head to according to which entrepreneurs. Specifically, those hardest hit by the economic effect of the crisis of the Covid-19. In March they would begin to have to repay these loans, but the Government will extend that period to avoid defaults and insolvencies, as ABC advanced at the end of October.
The Vice President for Economic Affairs, Nadia calviño, had decided the measure for weeks but lacked the approval of Brussels to be able to give it out. Finally, said extension will be approved in the next Council of Ministers this coming Tuesday, as confirmed by the economic head of the Government at the closing of the XXV S’Agaró Economy Meeting, which was held in Barcelona, as reported by Europa Press.
In this way, the Executive will give the green light to include bonuses and extensions in the initial lack of ICO credits, which is set at 12 months. As reported by ABC, Calviño’s intention is not to start repaying loans until 2022, which implies an extension of the grace period for one more year.
However, the Government’s plan also goes beyond the final repayment term of the loans. Until now they were set within a period of five years, but the objective, also transmitted by beneficiary companies, is that it increases to eight years. This is the margin that Calviño managed until a few weeks ago, although everything indicates that it could be considering that the extension would have variations depending on the sector. The vice president, in her speech, has not revealed anything in public about the times.
Going up to eight years, the amortization period would be equal to that of the ICO credits for investment. A second battery of guarantees for 40,000 million euros that the Executive announced in July, launched in September and that now are resulting in an absolute failure since they have no demand. Billions of which the Government even put out breast in the budget plan sent to Brussels, knowing by then that it was not being an effective measure.
In the same act, the Secretary of State for Commerce, Xiana Méndez, has launched into the air that the Government has in mind “immediate action” to support the commerce sector in order to try to save the Christmas campaign.
A battery of measures designed to generate “an immediate impact of cost mitigation”, which will cover different ministries, as well as municipalities and autonomous communities, as Efe collects. A “choral action” to react to a recovery that has not yet arrived; even more so now with new restrictions in place in many regions.
«Next week we will have the first news and it will be the first to arrive. In the coming weeks, measures will be approved especially aimed at SMEs and the self-employed, and at those vulnerable sectors, ”Méndez said.