BICA: THE RECOVERY AND SUSTAINABILITY PLAN SHOULD BE SUBMITTED AS SOON AS POSSIBLE FOR EC COMPLIANCE
There is no perfect Recovery and Sustainability Plan. No matter how much we change it, we cannot achieve absolute perfection. The best plan at the moment is the submitted plan. That is why we call for its accelerated submission and coordination with the European Commission. This was stated by the Executive Director of BICA Dobrin Ivanov during today’s meeting of the Committee on European Union Affairs in Parliament. Atanas Pekanov, Deputy Prime Minister for European Funds Management, was heard at the meeting in connection with the progress made in drafting the National Plan for Reconstruction and Sustainability of the Republic of Bulgaria.
During the meeting of the commission Dobrin Ivanov made two recommendations for improving the plan, which according to him do not require a change in the text and drafts of the plan. They relate only to the financial allocation, which allows these corrections to be made very easily and quickly.
The first recommendation has been made many times by BICA and it concerns the means for economic transformation of Bulgarian business. The association called for a balance to be struck between direct support for businesses and the possibility of providing financial instruments. “In the first version of the plan, the funds in the three funds for economic transformation were BGN 900 million and were only for direct support. In the latter case, they have been increased to BGN 1.2 billion, but the balance has been disturbed and financial instruments have been given precedence, “Ivanov added.
According to him, at the moment there are enough financial instruments on the Bulgarian market, which, however, the business does not recognize and does not use. The Executive Director of BICA reminded that out of BGN 2.5 billion provided by BDB to guarantee bank loans provided by commercial banks, only about BGN 334 million were utilized funds. This is below 15%, which shows that the effect sought by the government is not being achieved.
According to Dobrin Ivanov, the national plan is to restore the economy from the effects of the COVID-19 crisis. For these two years, Bulgarian companies have been decapitalized, heavily indebted, with reduced sales revenues and very difficult to invest. It is not acceptable for them to be offered a financial instrument – credit financing, because it will not provide a quick recovery, and may even in some cases worsen the financial condition of enterprises. While direct support will provide the necessary liquidity and will activate additional private investments in the form of self-financing amounting to at least 50% of the total value of the investment.
The second recommendation of BICA is regarding the funds provided under the scheme for support of pilot projects for production of green hydrogen and bio gas. For the association of the BGN 877 million set in the PVU for the construction of 1.7 gigawatt hours of RES and batteries for storage of the electricity produced by them, about BGN 150 million should be redirected to the scheme for economic transformation with the same purpose, while maintaining the overall commitment to the depletion of RES capacity. In this way, small and medium-sized enterprises will be given the opportunity to build renewable energy sources for about 350 megawatt hours, which they can use for their own needs. Thus, Bulgarian companies will reduce the total price of electricity they use and will be more competitive.