ECONOMY

Commissioner ?to make phone calls? for SME cash

European Union Regional Policy Commissioner Johannes Hahn expressed disappointment on Friday regarding the ?neglect? displayed toward strengthening the liquidity of small and medium-sized enterprises (SMEs) in Greece. At a press conference in Athens the official said that the delay concerns the disbursement of loans agreed with the European Investment Bank (EIB), too, and poignantly added that he would have to make a few phone calls upon his return to Brussels.

Hahn, who was visiting Greece to outline the most effective ways to use EU Regional Funds for growth in the EU?s next long-term budget (2014-20), said that he is not going ?to put the blame on anyone? but expressed determination to locate the source of the SME funding problem, stressing that ?everyone has to realize that the issue has got to do with people.?

While avoiding attributing responsibility to anyone in particular, his careful wording was likely directed at a number of parties as the problem is linked both to the delay of the representatives of Greece?s creditors — known as the troika — in drafting their report on the Greek economy and the next bailout tranche, and to the lack of flexibility on the part of the EIB as long as the recapitalization of Greek banks remains pending.

The good news concerns the 1.2-billion-euro increase in funds for SMEs through the redistribution of resources from the National Strategic Reference Framework (ESPA), but Hahn stressed the need for obstacles to be overcome for the cash to reach its recipients.

The Austrian commissioner appeared reserved regarding Greece?s capacity to implement its commitment in the context of the memorandum of understanding with its creditors concerning the absorption of ESPA funds totaling 3.7 billion euros. At the moment the absorption has been limited to just 700 million euros and although the majority of payments will be conducted at the end of the 2007-13 period, ?the target becomes exceptionally difficult to attain.?

There are also delays in 40 out of the 181 priority projects with a total budget of 11.5 billion euros, which the Commission is monitoring closely. The budget of the 40 problematic projects amounts to 7 billion euros, but they include five major highways, budgeted at 5 billion euros, whose funding has been frozen since 2009. Hahn expressed optimism about the completion of negotiations and the unblocking of the highway projects after the appointment of a special negotiator, but did not rule out a reduction in the projects so that they can be completed within the deadlines.

The regional policy commissioner argued that in terms of fund absorption, the country?s performance is actually a little better than the European Union average, but there is still a risk of loss of resources up to 2015, the year when the two-year extension to the funding period ends.

Among the sectors with the biggest problems in fund absorption is that of the environment, as the country?s commitment to the shutdown of landfills appears unlikely to be implemented.