The Regional Ministry of Agriculture, Livestock and Rural Development, directed by Jesús Julio Carnero, has published in the Official Gazette of Castile and León (Bocyl) the modification of the Order that regulates the Financial Instrument in the Community, establishing the deadline for applying for this type of loan on 31 December 2021.
In the crisis generated by the COVID-19, the agricultural and agri-food sector has responded well to the demand for food, showing that agricultural and livestock holdings, as well as the agri-food industry, are fundamental to the supply of the food chain. But the low demand in the catering channel, mainly, has in some cases generated problems both in production and in the processing industry.
Since 2018, the Regional Ministry of Agriculture, Livestock and Rural Development has been implementing the financial instrument within the framework of the 2014-2020 Rural Development Programme supported by the European Agricultural Fund for Rural Development (EAFRD). Castilla y León was the first autonomous community in Spain, and one of the first in Europe, to make this type of financial support available to the agricultural and agri-food sector. This is innovative in terms of aid, as it makes it possible to support actions entirely with guaranteed loans or to combine support from the Financial Instrument with non-repayable subsidies.
After the launch, the evolution of the loans formalized determines that the Instrument is configured as a relevant tool to support actions in the agricultural and agri-food sector. This is clear from the fact that, to date, the amount of guaranteed loans formalized is close to 75 million corresponding to 357 applications, which are intended to support investments in agricultural holdings and the agri-food industry, as well as the creation of businesses by young entrepreneurs, with the possibility of supporting the purchase of land at 100 percent in the case of young people.
Amendment of the order regulating the Financial Instrument
Following the declaration of the pandemic and in order to respond to the impact of the economic crisis, the European Commission made changes to Community legislation, including making the application of the Financial Instrument more flexible.
This amendment makes it possible to support working capital in small and medium-sized enterprises up to a maximum of EUR 200 000, without having to link it to an investment. In April, in order to include this option, the order regulating the Financial Instrument in Castilla y León was modified, establishing a deadline of 31 December 2020 for applying for this type of loan. Now, given the economic situation, the deadline for applying for working capital loans has been extended until 31 December 2021.
At present, agri-food industries and farms have already formalised working capital loans for an amount of almost two million euros, with a tendency to increase, and it is therefore necessary to continue to make this commitment.
Where should those interested in the Financial Instrument go
In order for interested parties to have access to the guaranteed loans, it is necessary to go to any of the offices of the banks that are members of the Financial Instrument. The Regional Ministry of Agriculture, Livestock and Rural Development will immediately resolve the applications received at these offices.
The catalogue offered by the Financial Instrument includes loans of a duration of 3, 5, 8, 10, 12, 15 and 20 years, with the possibility of a grace period of between one and three years, which may be four years for loans of 20 years.
