January the 18th, 2021 - The Croatian Government has taken steps to determine the largest amount of state aid which can be paid out to individual companies located/headquartered in the earthquake-stricken areas of central Croatia, more specifically Sisak-Moslavina County.
As Poslovni Dnevnik/Marija Brnic writes, with two decisions, the Croatian Government recently took the first steps towards the preparation of a long-term reconstruction of the earthquake-affected areas of Sisak-Moslavina County. At the suggestion of the Minister of Physical Planning, Construction and State Property, Darko Horvat, the renovation of buildings in these areas will be included in the law on reconstruction of Zagreb. As for the second part, which regards the re-design, preservation and restoration of economic life, which should go hand in hand with reconstruction of properties, will be in the hands of a special working group which will develop programmes for the social and economic revitalisation of the quake-affected areas.
The aforementioned working group is headed by Minister of Regional Development and EU Funds, Natasa Tramisak, and the Minister of Economy and Sustainable Development, Tomislav Coric. This government team will work to unite all competent departments from the Croatian Government, as well as all other actors, including the likes of the Croatian Employers' Association.
Minister Coric believes that the documentation that the working group will produce will provide a vision for the continued development of the area, which is necessary after the first measures that seek to lend a hand to those business owners who have suffered the most damage behgin. The priority of all of the measures, he says, will be to create a basis for people to stay in the affected area. Since the working group is yet to be formed, it is only known that the revitalisation programme will determine specific measures and projects, as well as who will be responsible for their implementation, and who will determine the method of financing all of the reconstruction measures.
The deadline for drafting this comprehensive reconstruction concept isn't actually stated in the Croatian Government's decision, but it is obvious that it will take months for this work to be carried out. For now, the Ministry of Economy is coming out with two "fire-fighting" instruments that it can provide first-hand to affected entities, especially small ones, to cover the most necessary costs of repairing the damage and to continue operating.
The first measure with the implementation of which his Ministry will start in ten days is the publication of a call for the allocation of ten million kuna. These are grants that were provided, as confirmed by the Ministry, with a recent aid package for the affected area through the Environmental Protection Fund. It isn't really a large fund that would cover all of the needs of business owners who suffered damage, and Minister Coric estimates that this could cover the most necessary costs of repairing machinery and business premises as well as other necessary expenses of small business owners from Glina, Petrinja and Sisak.
According to him, several hundred such business owners can count on this assistance from the available fund, and the largest individual amount of assistance will be 30,000 kuna. The significant package of 1.5 billion kuna of non-refundable aid intended for the increase of production capacities, procurement of equipment and digitalisation has been being prepared for months and isn't actually directly related to the rehabilitation of earthquake-affected areas. However, Minister Coric has since announced that business owners from the Banovina area will be able to count on a kind of advantage, since they come from an area with a lower development index, which will be "especially valued".
The conditions that interested business owners from the quake-stricken area need to meet and the programmes they can apply for, and the criteria for that programme that will be implemented through Hamag-Bicro, are all still being adjusted. The maximum amount that business owners, micro, small and medium, will be able to withdraw from this grant scheme under the project isn't yet known, but the assumption is that, judging by previous similar programmes, the range could be from 1 million to 15 million kuna.
According to the latest data, 750 craft (obrt) owners and 850 other companies have reported earthquake damage so far, and from yesterday's statements of the competent ministers, it is evident that it is still not possible to get to a definitive figure and add up the total damage caused by the devastating earthquake.
Therefore, the measures that will be comprehensive are yet to come to the table, and the ministers say that Sisak-Moslavina County has an important place. In the next phase, the preparation of a special tax model for the Banovina region has been announced, in order to encourage the maintenance and development of the economy in the area. The Croatian Government expects the maximum engagement of local companies, and the Minister of Economy has stated that when it comes to investments, "the readiness of a number of countries on a bilateral basis related to the recovery and reconstruction of infrastructure" in the affected area is present.
For more on the Petrinja earthquake, follow our dedicated section.
