GERB vs BSP: Will the state steal companies

PLAMEN MILEV

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Deputy Prime Minister and candidate for GERB MP Tomislav Donchev launched an attack against a measure proposed by the BSP for financing small businesses. It is about interest-free financing of start-up companies, replied Plamen Milev, an economic expert and candidate from the Socialists.

The start-up financing scheme offered by the BSP allows the state to gradually become a full master of companies, Donchev accused on Facebook.

“If you are not quite clear, I will explain how this scheme will work. You start your own business, say, in the field of production. You hire 5 people and your country becomes a partner, buying for example 10% of your company. The business starts and you hire 5 more workers and because “the scheme applies to every 5 new jobs”, the state buys another 10% of the company. Soon you hire 10 more people and your state is a partner with 40% of the company’s capital. If we continue with this logic, the moment you hire 50 staff,

your company will

has become entirely

state! ”,

analyzes the proposal of the socialists Donchev. And he criticized that “This is a ‘restoration of normal economic relations’, as stated at the beginning of the same document.”

“I finally understood why everything that GERB stole as an idea from the BSP was ruined. Unfortunately, the model “how to put business under control” adopted and applied for years prevents Tomislav Donchev from understanding that it can be managed with care for people and small business, “wrote the socialist Plamen Milev in response.

“The proposal is that if you have an idea but no money, the state should finance you in exchange for a commitment to new jobs. Business is not just loans and interest, Mr. Donchev. But for that, first of all, someone has to get out of the jeep and stop wasting our money on projects that collapse in the first rain “, added the red candidate.

The idea of ​​the BSP was actually to create a fund for equity financing. Who would give money to start-ups cheaper than banks, and entrepreneurs undertook to create jobs, he explained. With the allocated money, however, the state became a partner in private business. “You don’t owe her interest, nothing. You manage the company yourself, it does not interfere with you, but monitors how you spend the funds. And at some point, when you show that you have resilience – ie. you didn’t do it just to absorb some money, but this company really works, then

no problem yes

redeem your deeds

from the country. Ie this is interest-free financing, ”explained the red economist.

The equity proposal was aimed at high-risk businesses that banks had no interest in financing.

This is how the Fund of Funds should function – an idea borrowed from us, Milev explained. “But they made the mechanism so that they opened a number of sub-funds. The state is the guarantor, but you have to go through private intermediaries, “he added. That is why the absorption of these BGN 1.2 billion in the fund was minimal. In fact, the Fund of Funds was established under the Juncker Plan of the previous composition of the EC in order to attract cheap bank loans to European funds for business.

However, the idea of ​​the BSP is to have no intermediaries and the state to participate directly. And by easing the existing mechanism, small entrepreneurs would be given the opportunity to participate, and not just large companies, Milev explained.

Every year the state will receive a dividend, which will go back to the fund and new projects will be financed from there. And when the business expanded – by increasing the capital by reinvesting the profit, for example, the ratio in the shares remained the same. The redemption of the shares from the state will be done on a market basis, the red candidate claims.

The state’s participation gives a much more serious guarantee to foreign investors, Milev added. He gave the example that in Western Europe there are a number of successful companies that have started like this and continue to this day.

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