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The Forum for Development & Human Rights Dialogue Foundation Demands that Repayments of SME Loans be Postponed for Six Months due to Corona & the Issuance of a New Law that Includes Incentives for Youth Enterprises

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Saturday, April 18, 2020

Press Release
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The Forum for Development and Human Rights Dialogue on Saturday issued a policy paper supporting small enterprises due to the measures to combat the “Covid-19” virus, in which it monitored the impact of the closures accompanying the precautionary measures on the Corona virus small and medium-sized enterprises, especially since it is among the sectors that provide many jobs, as well as government initiatives to help these projects continue and reduce the harmful side effects of the closure process.  ‏

The paper addressed the efforts made by the state to help small businesses with a package of financial and non-financial assistance from the SME Development Agency to help the owners of these projects in the face of the crisis and the subsequent negative effects through four axes:

1- An exceptional loan for a short period of time (maximum one year) to ensure the continuity of these projects and help them to provide the necessary liquidity to finance operating and production expenses until this crisis exceeds that crisis, where the maximum of this loan amounts to one million pounds on terms and interest, and depending on the nature of the economic activity of each project, especially economic activities that have been very popular as a result of the emergence of Corona virus such as disinfectant production plants, detergent production plants of all kinds, trade activities and the supply of medical supplies and hygiene, disinfection and sterilization requirements.

2-Extending the repayment period for any project that has been damaged or has encountered obstacles that have led to its closure, low productivity or the like.

3- Issuing credit facilities for these affected projects until the crisis has ended and these projects stabilize again.

4- Financing projects to deal with the Corona crisis

Hani Emad, head of the central sector for financing small projects in the agency, announced that the agency is ready to provide additional funding and facilities for projects that need them to deal with the effects of the crisis of the spread of the Corona virus. On the other hand, many chambers of commerce contributed to the effort to support small business owners, where the Division of Household Appliances announced the initiative
#هنتحمل_بعض (We will Support Each Other) which appeals to the home appliances division of the Cairo Chamber of Commerce in which associates of major home appliance dealers to postpone the claims of small traders and postpone their financial claims of all kinds for two weeks in solidarity with the general situation and to ease the burden on traders.

The Household Appliances Division of the Cairo Chamber of Commerce appealed to landlords to reduce rental values for a month to ease tenants, while stressing that they were confident in their members and in their response to the initiative.

The Giza Chamber of Commerce also addressed all commercial centers in Giza governorate, calling on them to exempt their tenants from rent for three months, as a result of the government’s measures to counter the outbreak of the Covid 19 virus, stressing that these measures fall under the heading of compulsive force.

The paper concluded with a number of recommendations:

– Speeding up the promulgation of a new youth enterprise law that includes unprecedented incentives for young people, thus giving a new start to entrepreneurship

-Provide additional funding and facilities for projects that need funding to deal with the effects of the corona proliferation crisis.

– The postponement of the repayment of loan installments granted to young entrepreneurs and micro-enterprises, by the Enterprise Development Authority, for a period of six months, and of course this action is consistent with the actions taken by the State to face the negative economic repercussions of the dangerous virus, this organ is not subject to the banking system, and therefore is not covered by the decisions of the Central Bank, but is subject to the financial control body, and answers to the Council of Ministers directly.

– Insurance companies must bear the coverage of that period in relation to the fines of any delay, as well as the settlement of the “I-score Central Bank” with the Project Development Authority, in order to avoid the entry of young people on the blacklist as a result of the postponement of the payment of the required installments, with full coordination with credit risk guarantee companies.

-Replacing traditional services with their digital counterparts is the best alternative to continuing economic activities at both the current and future stage, particularly for microfinance industry practitioners who deal closely and directly with a broad base of more than 3 million beneficiaries, most of whom are simple people who are not aware of the required preventive measures.

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