OPINION

Don’t forget the small and medium-sized companies

While the country waits for an influx of major investment that is expected to create new jobs in the distant future, it is absolutely vital to bolster small to medium-sized companies as fast as possible. These companies were hit by the crisis harder than anyone else and probably generated the biggest number of unemployed people, and the most defenseless for that matter.

Unfortunately both the management and finance sectors are contributing to the confusion, instead of making things easier. Local chambers of commerce warn that the General Electronic Commercial Registry is under threat of collapsing as soon as it starts receiving the balance sheets of SA and Limited companies, that is within the next few days.

The TaxisNet system, meanwhile, was unable to meet demand on the first day of online tax declarations.

At the same time, the Hellenic Fund for Entrepreneurship and Development (ETEAN), an organization using European Union funding and offering favorable terms that could provide direct relief to small and medium-sized enterprises is moving at a particularly slow pace.

Meanwhile, banks that were selected to act as a liaison are also taking their time and seem more absorbed in the process of their recapitalization and self-preservation, while their executives are not up to speed with regard to the new financing tools and mechanisms.

As a result funds remain in limbo and are not reaching companies on time, while the real economy remains stagnant.

Besides, it is a well-known fact that the majority of funding loans issued by the previous version of ETEAN, known as the Guarantee Fund for Small and Very Small Enterprises (TEMPME), headed to the more powerful companies, firms with zero risk of payback, as opposed to those that really needed the money.

As a result of this practice those taking out loans placed the money in time deposit accounts and sought to make a profit, while the rest eventually went out of business.

A reboot of small to medium-sized companies would be possible with funding on a relatively small scale and would go a long way toward improving the current climate. After all, small companies have no other access to funding, given that they cannot issue corporate bonds, for instance.

In a state of emergency such as this one, action needs to be equally flexible: if the banking system cannot or does not wish to facilitate small and medium-sized company funding, it should be completely bypassed.

If cash flow mechanisms are slow, other tools ought to be sought.