BICA PROPOSES THE FORMATION OF AN ECONOMIC ANTI-CRISIS HEADQUARTERS FOR PREVENTING THE FAILURE OF THE BULGARIAN ECONOMY
Bulgarian Industrial Capital Association (BICA) appeals for the immediate establishment of an Economic Anti-Crisis Headquarters to identify a set of measures to save the Bulgarian economy through targeted support and assistance from the state to deal with the difficulties caused by the COVID-19 epidemic and the economic crisis. which they unlock. This is stated in an official letter of the employers’ organization to the Minister of Labor and Social Policy Denitsa Sacheva.
Supporting the need for immediate action to ensure the safety of Bulgarian citizens, BICA appeals for proportionate measures to support the economy, businesses and their employees. Disruption of normal economic activity, production processes and provision of services, even for a short period of time, seriously endangers the economy of our country and can lead to a permanent loss of market shares, reflecting a long-term loss of economic growth. This was also taken into account by the European Commission, which for this very reason allowed non-compliance with state aid rules in the development of measures to support the economy.
BICA makes constructive proposals to support Bulgarian companies, including following the practice introduced in a number of EU countries to support remuneration in the transition to reduced working hours, and the measure applies to all affected companies. If there is a complete cessation of activities, BICA proposes the state to simplify the insurance, which is at the expense of the company. If necessary, the Law on the Purpose should be amended, together with a set of more targeted measures to support SMEs and the incomes of working people.
According to BICA, key sectors for the Bulgarian economy need support at the moment. Examples are the manufacturing sectors, which suffer damage both due to disrupted supply chains and sales, restrictions on the movement or refusal of orders, and due to difficulties in the production process, due to the need for enhanced measures to prevent the spread of the virus and the associated additional contingencies.
BICA reminds that the EC has approved a temporary legal framework for flexibility with regard to state aid in the context of the COVID-19 epidemic. The temporary framework includes safeguards, linking direct financial assistance, subsidized loans or guarantees to businesses, tailored to the scale of their economic activity, based on their wage, turnover or liquidity costs and the use of budget support for working capital or investment capital.
The framework complements other options available to countries to mitigate the socio-economic impact of the epidemic, according to EU state aid rules. The EC has enabled countries to take action in favor of companies, for example by deferring tax payments or promoting temporary employment. States can also provide compensation to companies for damage caused by the epidemic.