REI analysis: A breath of fresh air for farmers – Up to EUR 300 million in non-reimbursable support for SMEs

Aurel Constantin 04/05/2022 | 13:44

The Ministry of European Investments and Projects (MIPE) has published on 29 April the draft GEO for POC 4.1.2, a new non-reimbursable funding axis for working capital in the agri-food sector, with a total allocated budget of around EUR 300 million.

 

The objective of the scheme is to support SMEs in the context of the economic recovery programme financed by non-reimbursable external funds, in the context of the economic crisis generated by the COVID-19 pandemic, by granting temporary aid of limited value to SMEs facing a shortage or even unavailability of liquidity, according to data consulted by REI Finance Advisors, one of the largest consultancy companies specialising in attracting non-reimbursable European funds and state aid.

The scheme provides non-reimbursable funding for different types of companies, from Registered Sole Trader, SMEs, associations, cooperatives and Individual Enterprise (IE).

Grants for working capital are available to the agriculture, fish farming, aquaculture and food industry sectors and eligible beneficiaries are SMEs, cooperatives, associations that have a minimum of 15% co-financing of working capital at the date of use of the grant for working capital, i.e. maintain or, where appropriate, increase the number of employees since the date of application for a period of at least 6 months at the time the grants are awarded.

  • 000 euro for Registered Sole Trader, IE, SME in eligible fields of activity, with a turnover for 2019 between 5.000 and 13.500 euro;
  • 15% of turnover, but no more than €100,000 for SMEs in the agricultural sector with turnover between €13,501 and €1 million;
  • 15% of the turnover for 2019, but no more than €120,000 for SMEs in the fish farming and aquaculture sectors in the eligible fields of activity, with turnover between €13,501 and €1 million;
  • A maximum of €100,000 for SMEs in the agricultural and agri-food sectors whose turnover exceeds €1 million;
  • A maximum of €120,000 for SMEs in the fish farming and aquaculture sectors whose turnover exceeds €1 million.

Eligible expenditure covers stocks of raw materials, materials, goods or other categories of stock not related to the activity, payment of current debts or arrears to suppliers, expenditure on rent based on a contract concluded or royalties, expenditure on the purchase of services necessary for the current activity, expenditure on the purchase of inventory, equipment, machinery, plant or technology, respectively payment of debts to the state budget.

“In the current context of rising prices of fertilizers and the impossibility of supplying certain raw materials, this funding for working capital is a breath of fresh air for agriculture and the agri-food industry in Romania. The scheme will attract a lot of interest, we expect between 10,000 and 20,000 applications, but much depends on when the session opens and the selection principles. According to the Ministry, the session will open on 25.05, and funding contracts will be signed by 30.06”, said Roxana Mircea, managing partner REI Finance Advisors.

Which areas are eligible under the measure “Working capital grant for agriculture, fish farming, aquaculture and food industry”?

According to the draft proposed by MIPE, the following sectors and classes of activity are eligible for access to non-reimbursable funds made available by the authorities in the next period:

A – Agriculture, forestry and fisheries

1 Agriculture, hunting and related services
11 Growing non-perennial plants
111 Growing of cereals (excluding rice), leguminous plants and oil seed crops
112 Rice cultivation
113 Growing vegetables and melons, root and tuber crops
114 Sugar cane cultivation
115 Tobacco growing
116 Growing plants for textile fibres
119 Cultivation of other non-perennial crops
12 Growing plants from permanent crops
121 Grape growing
122 Growing tropical and subtropical fruits
123 Growing citrus fruit
124 Cultivation of seed and stone fruits
125 Cultivation of fruit trees, fruit bushes, nut trees and other fruit trees
126 Growing oil fruits
127 Cultivation of plants for beverage preparation
128 Cultivation of spices, herbs, medicinal and pharmaceutical plants
129 Cultivarea altor plante permanent
13 Growing plants for propagation
130 Growing plants for propagation
14 Animal breeding
141 Dairy cattle breeding
142 Raising other cattle
143 Breeding horses and other equines
144 Breeding camels and camelids
145 Sheep and goat breeding
146 Pig farming
147 Bird breeding
149 Raising other animals
15 Mixed farm activities (crop growing combined with livestock farming)
150 Mixed farm activities (crop growing combined with livestock farming)
16 Support activities to agriculture and post-harvest activities
016 Support activities to agriculture and post-harvest activities
0161 Support activities for crop production
0162 Support activities for animal breeding
0163 Post-harvest activities
0164 Seed preparation
03 Fishing and aquaculture
031 Fishing
0311 Sea fishing
0312 Freshwater fishing
032 Aquaculture
0321 Maritime aquaculture
0322 Freshwater aquaculture
10 Food industry
101 Production, processing and preserving of meat and meat products
1011 Meat processing and preservation
1012 Processing and preserving of poultry meat
1013 Manufacture of meat products (including poultry meat)
102 Processing and preserving of fish, crustaceans and molluscs
1020 Processing and preserving of fish, crustaceans and molluscs
103 Processing and preserving of fruit and vegetables
1031 Processing and preservation of potatoes
1032 Manufacture of fruit and vegetable juices
1039 Processing and preserving of fruit and vegetables n.e.c.
104 Manufacture of vegetable and animal oils and fats
1041 Manufacture of oils and fats
1042 Manufacture of margarine and similar edible products
105 Dairy products manufacturing
1051 Manufacture of dairy products and cheese
1052 Ice cream production
106 Manufacture of bakery, starch and starch products
1061 Manufacture of bakery products
1062 Manufacture of starch and starch products
107 Manufacture of bakery and farinaceous products
1071 Manufacture of bread; manufacture of cakes and fresh pastry goods
1072 Manufacture of rusks and biscuits; manufacture of preserved pastry goods and cakes
1073 Manufacture of macaroni, noodles, couscous and similar farinaceous products
108 Manufacture of other food products
1081 Sugar manufacturing
1082 Manufacture of cocoa products, chocolate and sugar confectionery
1083 Tea and coffee processing
1084 Manufacture of spices and ingredients
1085 Manufacture of prepared meals
1086 Manufacture of homogenised food preparations and dietetic foods
1089 Manufacture of other food products n.e.c.
109 Manufacture of animal feedingstuffs
1091 Manufacture of prepared feeds for farm animals
1092 Manufacture of pet food
172 Manufacture of paper and paperboard products
1721 Manufacture of corrugated paper and paperboard and of paper and paperboard packaging

 

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