Deputy Prime Minister Bytyqi and Director Despotovski: We support 87 companies to implement projects for faster dealing with Covid 19 with a total value of about 3 million EUR

A total of 87 companies, which plan to implement projects worth about 3 million EUR, have been selected in the final selection from the call for co-financed grants for rapid adaptation of Covid -19, said today at a press conference in the Government, Deputy Prime Minister responsible for economic affairs and coordination with the economic sectors and investments, Fatmir Bytyqi and the director of the Fund for Innovation and Technology Development Jovan Despotovski. This instrument is part of the third set of measures adopted by the Government to support the citizens and the economy, and for easier overcoming of the socio-economic crisis caused by the coronavirus Covid 19.

Deputy Prime Minister Bytyqi referred to the implementation of all measures so far, pointing out that in creating the previous three packages, they were guided by the principle of social justice and solidarity, and they will continue in this direction with the fourth set, creating policies and measures that leave nobody alone. At a time when an immediate reaction is required, the Government of the Republic of North Macedonia created three sets of measures, for the implementation of which about 550 million EUR or 5.5% of GDP were reserved, measures that were timely and offer comprehensive support to the economy and citizens in dealing with the crisis.

"With the interest-free credit line COVID-1, through the Development Bank, we injected fresh funds of 5 million EUR into the economy for 737 companies, which employ 6,509 people, from the most affected sectors: tourism, hospitality and passenger transport. The Development Bank also placed a credit line COVID - 2 in the amount of 8 million EUR, which was intended for all activities. Through this credit line, a total of 639 credit applications were approved by domestic companies that employ 11,325 people. Companies from these sectors, as well as all others that recorded losses, used the support to pay the minimum wage of 14,500 MKD per employee, and in the three most critical months, April /May/ June, in average about 20,000 companies with about 120,000 employees were supported." , stressed Bytyqi.

The Deputy Prime Minister added that in addition to measures with direct financial aid, other types of aid were implemented, in the form of reduced interest rates on loans, deferred payment of installments on loans and taxes from companies to the state. Citizens have been and remain the focus of the Government support.

"As part of the third set of measures were the payment cards for unemployed people, low-income people and students, as well as tourism vouchers, which directly affected the increase of private consumption and assistance and revitalization of the most affected sectors – hospitality and tourism. A total of 309,000 cards worth 26.8 million EUR were made and taken. In addition, 117,000 citizens received tourism vouchers totaling around 12 million EUR in order to support domestic tourism.” said the Deputy Prime Minister.

The measures of the third package are still being implemented and their goal is to keep the jobs of the citizens, to provide additional development, to help the companies to return to the paths of growth and expansion of their capacities. Through the Instrument for co-financed grants for rapid adaptation of Covid-19, financial support was provided for technological development of enterprises and private health institutions to overcome the consequences of COVID-19, in order for the companies affected by the current situation to introduce new methods and technologies in their operations, as well as measures to protect the health of employees and customers, so that they can maintain a satisfactory level of productivity, generate revenue through new sales channels, introduce new products or services.

"Through this model, FITD provides support up to 70% of the total project budget, but not more than 3,000,000 MKD. The total number of companies that applied for the call is 171, and approved project proposals, after the final selection are 87. The amount of investment cycle for the implementation of all these 87 projects is approximately 3 million EUR, of which the funds requested from FITD are in the amount of 1.7 million EUR, and the funds from own co-financing are 1.3 million EUR," said Deputy Prime Minister Bytyqi.

The director of FITD, Jovan Despotovski, who presented the results of the final selection, said that the Fund successfully implemented this measure from the third set of economic measures by the government.

"With it, we directly targeted the healthy core of the economy that is ready to invest in adjustment and development even in times of crisis, and thus in a faster transition from the survival phase to the recovery phase. This shows that companies do not run for free funds, but have the faith, intention and capacity to invest their own funds in the process of economic recovery," Despotovski said.

He added that this list of companies could be increased because at the request of the Fund, the Committee for Approval of investments has already submitted an opinion to the companies from the final phase, which are not on this list, on which they can comment, and thus they will receive the opportunity to be reconsidered, after which the final decision on funding will be made.

"Within these 87 companies, we support 1296 of our fellow citizens and their families, but I expect this number to increase by about 30% after the completion of the public call. Every individual and every job is important to us. With these measures, as a government, we have shown that we can be a real partner by meeting the needs of the business sector, but not only in protecting the business but also protecting the employees and the jobs in the companies," said Despotovski.

According to Despotovski, it is an encouraging fact that by introducing additional criteria for additional scoring of companies with women in the management or ownership structure and companies coming from less developed regions the participation of such companies in the first cycle has been stimulated. More than half, i.e. 52% of these companies are run by women, and the number of companies based in less developed regions has increased. Compared to the previous calls, an increase was registered in the eastern (13%) southeastern (11%), Vardar (8%) and Polog region (3%).

Despotovski announced that a second investment cycle with changed criteria is already being prepared, which will be submitted to the Government next week as a proposal.

"Based on the analysis and consultations with the private sector and the data we received from research conducted among domestic companies, it helped us change this measure. A new rulebook has already been prepared, which envisages opening an opportunity for financing of large companies, as well as increasing the amount of financial support up to 20,000,000 MKD. It is also proposed to change the percentage of return on funds from 15% to 7.5% and to change the repayment period from 3 to 5 years. "I believe that with these changes, many of those 2,100 companies that have shown interest in the instrument will be encouraged and will enter a new investment cycle that will move from a survival phase to a recovery phase," said Despotovski.

Otherwise, out of the 87 companies that will be financed in the first cycle, 66 companies, i.e. 76% apply in the Fund for the first time, 15% for the second or more times without previously received support, while only 9% are previous beneficiaries of funds.

The investment plans of these companies refer to introducing new technologies in working in conditions of pandemic. Most of them are from the health sphere 21%, sale and trade (14%), IT (10%), but also categories such as mechanical engineering, creative industry, hospitality and textile industry. According to the analyses most of them are small (53) and micro (29) companies, as well as 6 middle-sized companies. These companies employ around 1296 persons and are expected to implement their investments in the following 12 months.

The decision on financing has been made by the Committee for Approval of investments, composed of five foreign experts on the base of previously announced criteria: technological progress and degree of digitalization in processes, development of a new or significantly improved product, service or work process of the applicant, then project quality, capacity of the project team and impact.

Total of 166 companies applied at the call which was opened from 29.05 to 03.07.2020 and over 2100 took application packets.

You can see the presentation of the results on the following link.