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Coface: The stimulation of the economy on the basis of consumption helped the big companies mostly
Only the big companies managed to capture the effects of the economic growth based on consumption as they were the only to be able to increase the capacity of production or distribution, stated on Wednesday Iancu Guda, services manager, Coface Romania at the presentation of Top 500 companies of Central and Eastern Europe (CEE) made by Coface.
‘This stimulus on consumption, on purchase power, you cannot get it unless you can adapt, you grow your capacity of production or distribution. And if you are small it is difficult to keep the rhythm, to be flexible. All these stimuli which theoretically were expected to help the small companies, in fact helped the big companies which got the positive effects in the economy and practically the business concentrated to the top. There are still 94% of the active companies which are micro-entreprises. I think it is a phenomenon of avoiding or fiscal optimization because some of business is one million and over euro, we have concrete examples they move their business on the second company to keep them both under one million and pay only 1% taxes on income as if they are over one million euro they have no such option’ Iancu Guda said.
He says that in Romania there are 500 active companies and the first 1000 which is 0.2% concentrate half of the business, as it is about polarization which is not seen in other countries in the region.
Iancu Guda stated that we have reached a new historic maximum of the debts of active companies, in Romania, of 371 billion lei in 2018, while the banking lending is growing very slowly. The balance of the loans offered to companies in 2018 was 110 billion lei.
Asked if the majority of the pension point will take place, he said that the second and third level of increases raise big worries and questions regarding the sustainability a? the elements which support these rhythms of increase of the pensions lack or they are not at the sufficient level to support such increase.