Romania's Chamber of Deputies passed, on Wednesday, May 20, the Government's emergency ordinance targeting the program for supporting small and medium enterprises (SMEs) - IMM Invest.

Still, the deputies amended it and doubled the ceiling of state guarantees that can be granted under the program to RON 30 bln (EUR 6.2 bln), G4media.ro reported. The amendment also implies doubling the expenditures from the public budget related to this program.

The Senate also adopted the bill, and the Chamber of Deputies was the decision-making body in this case.

In response to deputies doubling the program's size (and the related expenditure from the budget), finance minister Florin Citu said that the European Commission should be consulted about any increase in the size of the IMM Invest program.

Romanian SMEs heavily oversubscribed the program by placing requests for loans worth over RON 150 bln. However, the banks enrolled in this program have approved only a small number of applications so far.

"The idea was not to give money to whoever under whatever terms," independent analyst Iancu Guda stressed. He explained that the money is not for the highly indebted firms with negative equity, or for firms that are running losses. Dumitru Nancu, the general director of the Guarantee Fund for SMEs, claims that 5,000 loan requests have been approved. He estimates that the banks will approve about half of the applications filed by SMEs.

(Photo: Cateyeperspective/ Dreamstime)

editor@romania-insider.com