100.000 small and medium enterprises are expected to close down

Joi, 30 iulie 2009, 21:13 English | Business

The president of the National Council for Small and Medium Enterprises declared on July 30 that at least 115.000 companies are expected to close down by the end of the year, a figure at least equal with the number of companies that closed their business during the first semester of 2009. Out of the surviving companies, over 70% will be forced to let part of their staff go.

98% of the small and medium enterprises (IMM) are micro-enterprises. The most affected departments are said to be retail and services. The entrepreneurs expect for the economic downturn to be more intense in the second part of 2009 and in 2010.

Nicolaescu estimate that the second semester of the current year will affect the incomes of state employees greatly. He adds that the World Bank will have to accept a bigger budget deficit for Romania, because the economic burden of the country will not leave other choice. "Otherwise, we'll go into collapse. There is no other solution", Nicolaescu said.

In his opinion, the IMF delegation should impose a greater transparency in handling the money granted through the agreement. As for credits, Nicolaescu opinionated that the relationship with the banks evolves "very slow", mainly due to lack of liquidities on the market, "also triggered by the fact that the state had borrowed massively and continues to do so".