Bulgaria 'Competitive Economy' Program Gains MomentumFinance | March 30, 2010, Tuesday // 16:44| views
Bulgaria's Deputy Economy Minister, Evgeni Angelov, reports a considerably increased take-up of operational funds by Bulgarian enterprises. Photo by BGNES
Bulgaria's operational program for "Competitiveness of the Economy" is now gaining momentum, with 700 contracts signed in less than a year.
Deputy Economy Minister Evgeni Angelov reported on Tuesday that this figure compared with less than 100 such deals concluded in the previous twelve months.
Angelov addressed a Sofia conference devoted to discussing prospects for development of the program, which is primarily intended to support small and medium Bulgarian enterprises (SMEs).
As the Bulgarian government views investments in new technologies and products as a priority, most of the support schemes are targeted at this sector.
A study has shown that the number of companies that have invested in innovation has almost doubled within one year, from 43% to 71%.
The complicated application procedures for the program prove the biggest problem faced by companies. This obstacle has led to to poor absorption rates up.
Deputy Minister Angelov said statistics showed that, by early March, contracts for only EUR 10 M had been signed, out of a total resource of EUR 1,162 B that must be absorbed by the end of 2013.
He explained that the Ministry intended to simplify the application procedure, and to speed the process with an initial screening of applications. Until now, the practise has been to check and review applications only after one or two months.
Angelov added that support documents and guidelines for applications would also be made available to businesses at the point of opening the projects.
Finally, he announced that an agreement would probably be signed within two weeks with the European investment fund that will manage the holding company with the three risk financing funds, a move he said was eagerly awaited by Bulgarian entrepreneurs.
The three companies will have a total capital of BGN 300 M, with BGN 160 M coming from the European scheme JEREMIE*, and the remaining BGN 140 M expected to come from private capital.
*Introduced for the 2007-2013 period and part of the Cohesion Fund, the JEREMIE (Joint European Resources for Micro to Medium Enterprises) program allows Member States to set up financial instruments for SMEs at a regional level.
The European Commission, European Investment Bank and European Investment Fund together provide the funds.
Preference is given to small businesses those with less than 50 employees and annual turnover of less than EUR 10 M, and micro enterprises with less than ten employees and turnover of less than EUR 2 M.
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