In order to stabilise the economic situation during the Covid-19 crisis and to support entrepreneurs, a series of state aid programmes were developed ranging from downtime benefits to employees and tax holidays, which provided support and a foothold for entrepreneurs during the crisis, to investment in working capital and the development of new products, and the promotion of international competitiveness and exports.
Among the aid programmes developed by the Ministry of Economics, the most popular is the Altum loan programme to ensure the availability of working capital and guarantee programmes for the economic operators affected by the spread of Covid-19, which have been available to undertakings from 25 March 2020. On August 21, Altum has issued loans to undertakings amounting to 83 million euro for the implementation of 446 projects. Altum, in cooperation with banks, has so far provided credit holiday opportunities for businesses amounting to more than 84.7 million euro, issuing guarantees for 31.5 million euro for a total of 161 deals. The aid programmes are still available to entrepreneurs, and we welcome undertakings to contact Altum on the opportunities to receive the aid.
As of this March, a company in any industry affected by Covid-19 could qualify for a downtime benefit. For the period from this March 12 to June 30, during the period of downtime caused by Covid-19, the State Revenue Service (SRS) has paid out 126,946 downtime benefits for a total of 51.3 million euro to employees. A total of 52,791 employees have received these benefits one or several times.
A new instrument for overcoming the effects of the Covid-19 crisis was created to boost employment for exporting taxpaying companies and businesses in the tourism sector following the end of the downtime allowance. Until this August 21, the Latvian Investment and Development Agency (IDAL) provided aid to 51 exporting companies for 6,554,413 euro and 171 tourism industry companies for 4,322,804 euro. These two aid instruments are available to undertakings until this September 30, we welcome undertakings to contact IDAL on the opportunities to receive the aid.
Entrepreneurs also had and still have access to a number of aid instruments in the form of taxes, including tax holidays up to 3 years. Since the beginning of the downtime period induced by Covid-19 until August 24 14,586 entrepreneurs have been granted tax payment extensions of different duration for a total of 253,917,070 euro. Tax holidays of up to 3 years will be available to entrepreneurs until the end of this year. Information on support measures administered by the SRS is available to entrepreneurs on the SRS website.
It is also important to point out that a special aid mechanism has been developed to support the tourism sector to cover the costs of repatriation to tour operators, providing that tour operators registered and licensed in Latvia may apply to the Consumer Rights Protection Centre by 1 October 2020 for grants in order to compensate for the costs of repatriation of tourists resulting from the spread of Covid-19. Until now, no applications for aid have been received by CRPC.
Additional funding has also been granted for training of employees in support of high-level training on strategic business management, as well as ICT, non-technological training, and training to encourage investor engagement. As part of these programmes, so far support has been provided to 1924 companies providing training for 18,827 employees for 8,400,000 euro. A number of aid instruments for digital development of companies have been developed this year for the development of human resources: a high-level training programme (including the Mini-MBA programme) for entrepreneurs and business managers, a new aid instrument for training – for taking over good practices from other experienced companies in Latvia and the world. It is also planned to carry out a public awareness campaign to motivate the population to learn all their lives (lifelong learning).
Guarantees for large enterprises and the Capital Fund for large enterprises are also available for further development of business, and we are also currently working on a number of aid programmes that will be available to entrepreneurs until the end of this year – for loans and their interest rate subsidies for undertakings to boost competitiveness and for other financial instruments.
Additional funding was also granted to the Housing Guarantee Support Programme implemented by Altum, under which Altum provides a guarantee for a bank loan for the purchase or construction of housing for families with children. Until now, the programme grants housing guarantees to 14,726 families with children (with a total of 21,148 children in families) for a total amount of 27,2 million euro. Additional work is continuing on a new support instrument to boost housing availability – the “Support” programme, which provides a grant to private persons for the construction or purchase of housing.
At the same time, additional funding was also granted for energy efficiency improvements in multi-apartment buildings, contributing to the development of the construction sector and the retention of jobs. As part of the programme, Altum has so far provided support – grants amounting to 64 million euro for the renovation of 618 buildings; 269 projects are still under review. In addition, we are working on a new support programme to improve the energy efficiency of private houses.