The Government has today given the green light to the expected package of aid to companies of 11,000 million with the economy fully suffering the effects of the third wave and that, as recognized by the economic vice president, Nadia Calviño, has already generated a “slowdown” recovery in the first quarter of 2021. The new aid plan has a direct aid fund of 7,000 million, of which 2,000 million will be only for the Canary Islands and the Balearic Islands, the two communities most affected by the pandemic due to their greater dependence of tourism, while the remaining 5,000 million will go to the rest of autonomous communities.
Thus, the aid package will be managed by the autonomous communities and they will be able to host SMEs and freelancers from 100 different economic activities, which include those that can currently access the ERTE Covid and contemplates some new ones. These may compensate, at most, 40% of the drop in income in the case of SMEs and micro-SMEs, and up to 20% for other companies. The self-employed who pay taxes in the module system will receive up to 3,000 euros and the aid for the rest of the companies will be between 4,000 and 200,000 euros, amounts that the Government of the Canary Islands and the Balearic Islands may, although all this will be done within the limits of State aid set by Brussels.
As Calviño clarified in the press conference after the extraordinary meeting of the Council of Ministers, the aid will be accessible to companies with drops of at least 30% of the turnover and they will be able to dedicate themselves to the payment of fixed expenses, supplier debts and the payment of other expenses with financial and non-financial creditors. The point is that “the corporate over-indebtedness is weighing on the recovery,” according to Calviño.
Along with direct aid, the plan includes a line of 3,000 million that will be managed by the ICO to increase the terms of the guarantees and their amount. It will also be possible to convert the credits into participative loans and, as a last resort, to give direct transfers to SMEs and the self-employed that allow the principal capital to be reduced. Calviño has announced that all this will require the approval of a new Code of Good Practices with the banking sector, in line with the one already in place for the granting of mortgages.
The third leg of the program will be the recapitalization fund of 1,000 million, which will be managed by Cofides and which complements the SEPI fund of 10,000 million for large companies. That of Cofides will be used to strengthen the balance of smaller companies. The aid will imply that the companies must remain active until June 30, 2022 and that they will not be able to distribute dividends or raise salaries of their senior management for two years.