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Franz Fayot and Pierre Gramegna say the state aid schemes have been the best way to help businesses during the pandemic. Photo: SIP / Julien Warnand 

The state schemes “have helped our companies and their employees best in the face of this pandemic and the economic consequences it entails,” said Gramegna. Fayot welcomed “the success of the aid scheme to stimulate sustainable investment, which shows companies’ optimism about the future and their willingness to innovate and thus contribute to a more sustainable recovery of the economy.”

Repayable advances

This is a capital advance to meet the liquidity needs of companies in temporary financial difficulty following the crisis. It has an upper limit of €800,000 and covers up to 50% of eligible costs. Reimbursement is based on a plan established with the ministry, no earlier than 12 months after the assistance is received.

Some 2,117 advances were awarded, amounting to a total of €162.2m. In 2020, the construction sector received the largest subsidy ($30.5m). “The closure of restaurants and bars since 26 November 2020 has had a significant impact on the [hospitality] sector, which has been granted an additional €9m to deal with the crisis, making the accommodation and catering sector the largest recipient of repayable advances,” the government said in a press release.

The scheme was due to expire at the end of June but has been extended until the end of this year.

Loans guaranteed by the state

Companies can take out a loan up to 25% of their turnover, for a maximum duration of six years. The state provides a guarantee of 85% via an agreement signed with eight banks. Since it was made available, 415 applications have been submitted and 382 loans have been granted for a total of €176.26m.

Enterprises in the commercial trades used it most (€60m), followed by accommodation and catering, manufacturing and construction.

The possibility to apply for a guaranteed loan has been extended until the end of December 2021.

Raising the maximum aid ceiling

Set up in July 2020 as part of the government’s Neistart programme, this instrument aims to encourage companies to carry out economic development projects, digitalisation or environmental protection. Financial aid of up to 50% of eligible costs was being made available. It is aimed at companies that have experienced a significant decline in turnover during the crisis, with the aim of allowing them to receive much higher amounts of investment aid than in normal times, particularly for projects relating to the development of the circular economy.

The current scheme expires at the end of June and has been extended until the end of this year. Companies will be able to submit applications until the end of October at the latest.

In addition, the ceiling for aid per company has been increased to €1,800,000 from the current €800,000.

219 aid applications have already been requested for a total amount of €63.07m. Most of the projects supported by Neistart are linked to the industrial sector--accounting for nearly €20m--followed by the construction sector for €15.7m, and trade for more than €9.9m.

This article was originally published by Paperjam and has been translated and edited for Delano.