BIA'S STATEMENT ON THE ANTI-CRISIS MEASURES PROPOSED BY THE ME OF BULGARIA
TO
Mr. LACHEZAR BORISOV
MINISTER OF ECONOMY
SLAVYANSKA STREET 8
SOFIA 1052
Subject: Proposals of the Ministry of Economy for program anti-crisis measures and measures for development of the economy, implemented until the end of the year, discussed on 28.07.2020 with representatives of the employers' organizations
DEAR MR. BORISOV,
Thank you for the meeting and the timely involvement of business representatives in the process of developing economic measures to deal with the consequences of the COVID-19 crisis.
In view of the agreement reached at the meeting, we enclose comments on the presented measures.
I. General measures:
Under item 1, we express satisfaction with the stated will of the National Tripartite Agreement to be a fundamental program document in the work of the Ministry of Economy. The measures covered by it will help improve the business environment in the foreseeable and long term.
Under item 2 Specific measures for improving the control over the transparent spending of public funds and avoiding and preventing possible corrupt practices, abuses and unregulated relations.
BIA is satisfied that its proposals for introduction of anti-corruption measures and prevention of illegal absorption of ESIF funds have been accepted. We support the proposal made at the meeting to create a public register of expenditures. Regular provision of information and publicity is in itself a strong anti-corruption tool.
With regard to the proposal to include representatives of employers' organizations in a working group to be formed at the Inspectorate of the Ministry of Economy, we believe that before expressing an opinion, further discussion of the functions and powers of this working group and the role of , which would be performed by the representatives of the employers' organizations.
Under items 3 and 4 on Creating additional opportunities for support of investors implementing projects important for the economy, certified under the Investment Promotion Act, including with regional opportunities (IPO) and Initiation of changes in IPA in order to create conditions for attracting strategic investors in compliance with the European State Aid Map, we express our support, reserving the right to express additional proposals and comments after formulating specific proposals to amend the relevant regulations.
II. Specific measures for public investments in the economy amounting to over BGN 1.8 billion, investments of public funds in the economy in the form of grants and direct financing.
In addition to the measures supported at the meeting, we make the following proposals:
1. Redirection of the provided BGN 200 million for BDB from OPIC for bank guarantees for implementation of new procedures for providing grants for providing investment support for the Bulgarian business, for dealing with the consequences of COVID-19, coordinated with employers and trade unions .
We support our proposal to create a working group with the participation of representatives of employers' organizations, to develop a set of application documents. Given the growing negative effects of the crisis and in order to achieve maximum effect for enterprises in the short term, we believe that this resource should be directed to liquid support for micro, small and medium enterprises. In view of the identified shortcomings, under the current two liquidity support procedures for micro and small and medium-sized enterprises, we offer:
- adoption of differentiated minimum and maximum amounts of grants for different categories of enterprises. Experience has shown that the provision of equal grants to micro and small enterprises does not correspond to their needs and does not lead to effective support for small enterprises;
- providing suitable eligibility criteria for applicants, without including criteria for technical and financial evaluation of project proposals;
- distribution of the budget of the procedure by economic sectors (activities). Adopting such an approach will limit the pressure on business and administration in the application process, as the "first in time - first in law" criterion creates conditions for the application of unfair practices in cases where all participants apply within a common budget;
- elimination of the need to apply documents in UMIS at the application stage, by creating an opportunity to declare circumstances in a structured electronic form, in the details of the project proposal (similar to the Single European Public Procurement Document);
- two electronic (attached and detached) signatures and the possibility to sign on paper, unnecessarily complicates the application process. Such components for electronic identification are successfully used in the Electronic Services System of the National Revenue Agency and the Business Statistics IS of the NSI. In addition, the current practice of creating a project proposal in an electronic environment and generating a file to sign in an offline environment when submitting it, and reloading the signature file in an electronic environment, is fundamentally contrary to the idea of an e-government. .
2. Providing financing to SMEs through the voucher scheme to facilitate SMEs' access to digital know-how and technologies and to connect with ICT service providers.
We support the proposed measure, again drawing attention to the need to increase the financial resources provided. Given the fact that digitalisation activities will be funded through different measures, we propose to consider them simultaneously.
3. Accelerate the procedure "Support for medium-sized enterprises to overcome the economic consequences of the COVID-19 pandemic"
In order to provide timely support to the beneficiaries, we propose to eliminate the requirement to present a bank guarantee in case of a request for advance payment or admission of other forms of collateral provided for in the Public Procurement Act.
The programming of the measures for which funding has already been provided should be in line with the expected funds within the EC Initiative - REACT-EU, which also provides funds to overcome the consequences of COVID-19 and prepare for the transition to digital. and the green economy.
We also count on your commitment to support the measures agreed within the National Council for Tripartite Cooperation and proposed by our members, including:
- Introduction of a mechanism to compensate for the indirect costs of carbon emissions in order to alleviate the costs of electricity caused by rising carbon prices
Introduction of financial compensation for indirect carbon costs of enterprises in energy-intensive industries and sub-sectors eligible under the European Commission Guidelines on certain State aid measures in the context of the post-2012 greenhouse gas emission allowance trading scheme. The processes for implementation of the measure began in 2019 with the preparation of the necessary amendments to the Climate Change Limitation Act (CIPA) and their submission for adoption by the National Assembly. The scheme has been introduced in many European countries. With rising emission prices and the additional negative effects of the epidemic crisis, the lack of such aid greatly reduces the competitiveness of Bulgarian heavy industry. The annual budget of the measure is BGN 33 million. It will have a direct effect on producers and will support export industries exposed to a significant risk of carbon leakage.
2. Repeal of the reduction in the period of application of the compensation for indirect carbon costs to undertakings in sectors and sub-sectors exposed to a significant risk of carbon leakage due to the transfer of greenhouse gas emission allowance costs to electricity prices. We insist on maintaining the initially envisaged term for application of the compensatory scheme - July 1, 2019 to December 31, 2020.
3. Introduction of a ceiling on expenditures at the price of “liabilities to society” up to BGN 150 thousand per year
The limitation of the amounts paid by production enterprises at the price of "liabilities to society" to BGN 150,000 per year will reduce the non-energy component in the prices, respectively in the costs for electricity of the industry in accordance with Art. 38 of DIRECTIVE (EU) 2019/944 OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL of 5 June 2019 on common rules for the internal market in electricity and amending Directive 2012/27 / EU. The measure should cover producers from all sectors of industry, in compliance with the state aid requirements of the European Commission.
WITH RESPECT,
RADOSVET RADEV
Chairman of the Board of BIA
