The Administrative Managers warn that almost 100,000 companies are already technically bankrupt
The rise in costs due to inflation and the foreseeable tightening of credit conditions amid rising interest rates are reintroducing the SME business, which is already suffering the impact in addition to the impact that the pandemic has had on its profit margins.
“There are sectors that are recovering very well, such as tourism and hospitality, but others, such as textiles or vehicles, are declining,” warns Fernando Santiago, president of the Administrative Managers. From the industry, they calculate that some 700,000 companies currently have liquidity problems, of which about 100,000 are in a situation of technical bankruptcy.
In his day-to-day dealings with these companies, Santiago warns that problems have also been identified with the renewals of the ICO-backed loans granted during the pandemic. “The bank started austerity because it does not trust the state guarantees and innovations have been made,” he emphasizes. According to the calculations of these experts, 25% of small and medium-sized businesses have a ‘Covid ICO’. “Of them, 85% have encountered problems with the banks extending the amortization periods set out in the industry’s Code of Good Practices,” emphasizes Santiago.
He also denounces that while “there are things the government has done well with European funds, such as developing the digital kit”, aid from the next generation of companies is not reaching. Among other things, because they are confronted with a very complex bureaucratic burden that is practically unattainable for many groups, also because of the poor approach to the digitization process of public administration, according to the managers.
In this environment where financing will become more expensive and costs continue to rise, administrative managers warn that many companies are moving to the shadow economy “to survive”. Faced with this situation, they are asking the government to impose effective mechanisms to oxygenate SMEs. His proposals include more tax cuts and, above all, that incentives or bonuses for small businesses are not abolished.
“The situation is very bad. We are in times when the legislation does not favor SMEs and the self-employed and the problem is that, in addition to those that are closed, no real entrepreneurs come in; the new companies that have arisen because they open the doors closed off from the labor market and have no other choice’, says Santiago.
Despite the fact that the data on the evolution of the labor market continues to show signs of strength, the chairman of the administrative managers criticizes that “whatever they say, fewer hours are worked, part-time contracts are increasing, 70% of contracts remain public. .. nothing moves on a private level».
Source: La Verdad
I’m Wayne Wickman, a professional journalist and author for Today Times Live. My specialty is covering global news and current events, offering readers a unique perspective on the world’s most pressing issues. I’m passionate about storytelling and helping people stay informed on the goings-on of our planet.
