F. Barciela / F. Gil Ljubetic | For a long time, and particularly since the crisis, it has been clear that the excessive level of payment default in our country is one of the reasons, if not the main one, behind the demise of our companies, above all SMEs.
In the early years of the crisis, Spain’s capital markets and banks suffered severe financing restrictions, but since then access to funding has been slowly re-established for big companies, as well as for SMEs and families. And analysts believe this is now functioning normally.
In the corporate world, size is also important. One of the areas still pending reform in Spain, and one of the economy’s biggest weaknesses, is the size of companies. According to studies published by groups like the Circulo de Empresarios (Circle of Entrepreneurs) or research institution Fedea, Spain’s GDP would grow 13-15% if the average size of its companies was closer to that of neighbouring countries like Germany or the UK.
MADRID| Sean Duffy| Spain has been trying to enhance the business climate for entrepreneurs, but experts say that more needs to be done to spur growth in vital sector of the economy.
MADRID | The Corner | Spain is to be one of the first beneficiaries of the European Commission´s Investment Plan for Europe, with €3.2Bn being allocated to the country to support the SME sector.
MADRID | The Corner | The Spanish Confederation of Small- and Medium-Sized Companies (CEPYME) points to a “nascent trend” towards a normalization of credit markets, which will permeate down to the real economy over the course of next year.
FRANKFURT | By Lidia Conde | Martin Gornig is deputy head of department of Firms and Markets at the prestigious German Institute for Economic Research (DIW) in Berlin. The Institute conducts a working group that advises the Minister of Economy Sigmar Gabriel with the idea of increasing investments in Germany. Gornig and his team released a report last summer on the possibility of stimulating growth in Europe without changing the Stability Pact. The proposal of DIW is to immediately mobilize the necessary investments “to boost growth in countries in crisis and avoid a new recession in the eurozone.” As France and Italy are demanding, the Institute bets on growth but warns that it should not be at the expense of a debt increase
MADRID | The Corner | A further sign of a recovery in credit: standards on loans within the eurozone have been eased for the first time in the 2Q in seven years, just before the financial crisis bursted, the ECB said in its regular Banking Lending Survey released on Wednesday. Net demand continues to recover for both household and enterprise borrowing. However, as we reported, the open bar announced by Mr Draghi won’t have an impact on loans until 2015 and, meanwhile, credit fall continues to accelerate in some peripheral countries, especially in Spain and Italy.
MADRID | By Carlos Díaz Güell | Last week’s greatest news for SMEs were the Targeted Long Term Refinancing Operations (TLTRO), variety of LTROs that got a T standing for target. Banks will be allowed to borrow money at 0.25% interest rate at 4 years max.
MADRID | By Julia Pastor | The key for a Spanish sustainable economic recovery are the country’s SMEs. Considering they mean about 90% of the national corporate landscape, the IMF’s last report on Spain provides two main recipes for helping them survive: extending aids for insolvent companies, which would “preserve Spain’s strong payment culture,” and also increasing wages cuts.