Moscow Mayor Sergei Sobyanin said in a blog post on his personal website that last week the turnover of small and medium-sized enterprises operating in the consumer market reached 95% of the values of mid-March, when the restrictions were introduced due to the coronavirus.
The mayor noted that small and medium-sized businesses are the main economy of Moscow, as 776 thousand small enterprises employ 2.7 million people and form over 20% of the city budget. However, it was small and medium-sized businesses that bore the heaviest blow of the pandemic, so to help these enterprises, the Moscow government developed several support packages worth 85 billion rubles.
According to Sobyanin, the most urgent help – deferral of taxes and other mandatory payments – was provided automatically. This, as the mayor noted, helped to survive the “closed doors” shock period.
Now, after the restrictions have been lifted, small and medium-sized businesses are actively returning to work, but, the mayor stressed, the problems are not over yet. He noted that after the resumption of work, costs will quickly return to their previous level, and the restoration of the pre-crisis level of income may take several months or even years. Therefore, the Moscow authorities have offered entrepreneurs a range of support measures designed to address the post-appearance problems of low demand.
“First of all, we have agreed with the largest banks on the implementation of an unprecedented program of concessional lending. For previously taken loans, the city budget took on subsidizing the interest rate up to 6% per annum. For example, if before the pandemic the loan was taken at 11%, then the entrepreneur will pay 5 %, and the rest of the interest will be covered by the budget, “Sergei Sobyanin said.
He also noted that for new stabilization loans to finance current activities, the size of the compensation payment for an SME entity will be 8%, that is, the real cost of a loan for an entrepreneur will be only 3-7% per annum.
The mayor cited data that since April, when the concessional lending program was announced, loans have already been received or refinanced by 1,529 companies in the amount of 28.4 billion rubles. All in all, the banks received applications from 17 thousand small and medium-sized enterprises, which employ 130 thousand people.
To keep entrepreneurs’ taste for innovation and development, the 13 Subsidies program was launched, which helps offset the costs of purchasing equipment, engineering, implementing an innovative project, exporting products abroad, etc.
“In the first three months of the program, 572 entrepreneurs have already received support. Several hundred more applications will be approved in the coming weeks,” Sobyanin wrote, adding that a decision has been made to expand the “13 subsidies” program.
According to the mayor, businesses operating in the field of education, culture, leisure and entertainment, physical education and sports, as well as art galleries and art auctions will now be able to participate in the program. About 28 thousand small and medium-sized businesses in Moscow operate in these industries. Sobyanin emphasized that these figures are not a mere abstraction, behind them are the fate of many people.
“After four months of restrictions, the engine of the Moscow economy is gaining momentum again. The most flexible, active and entrepreneurial small and medium-sized businesses are spearheading the recovery. The success of business is the success and prosperity of Moscow, ”the mayor emphasized.