The economy is currently trying to get through this period as well as possible. Most of them are already tapping into those reserves that they´d actually need as "working capital" for normal operations, or at least to ramp up their business again. So when new contracts finally come in that have to be pre-financed, there is often not enough money! While our government has pledged to provide the necessary liquidity, little or none of it is actually arriving. Why is that?
I am guessing that it is not the fault of the Austrian Kontrollbank OeKB. In the financial crisis of 2008, it demonstrated really efficient crisis management, and this time it is also working with its own instrument for exporters. On this occasion, however, the so-called "Financing Agency of the Federal Government Ltd. (COFAG)" was created to handle requests for assistance and loans.
Simply put, for all companies above the SME threshold this means preparing a complex application with considerable effort and to forward it to their main bank. This is mostly already done with the help of a consulting firm. The application is then processed for credit purposes at the bank and credit terms are negotiated with the company. Only when the bank has made its credit decision is the application forwarded to OeKB - for processing and preparation for COFAG, which is ultimately responsible for the decision. COFAG, in turn, partly uses the well-known consulting companies to process the applications.
And it is here - more precisely in the complexity of this process and the associated efficiency - where the problem seems to lie.
All the players, including the consulting firms, do their job properly, but at the expense of several days of work. The result is that so far only a few applications have found their way to OeKB or have been decided by COFAG. The situation is different for the smaller AWS grants, where things are apparently less complicated.
It may be worth asking if there aren´t more efficient and quicker methods around. With today's possibilities of automatic data processing and corresponding algorithms, an initial, liquidity-triggering quick check could average the "working capital" of the past two years from the balance sheet and release it immediately. The corresponding, precise calculations can subsequently be submitted as part of the annual balance sheet.
However, even the 100% guarantee for loans by the state often does not lead to the desired result, as the banks - driven by the fear of becoming liable for any deficiencies in their guarantee processing or losing the guarantee coverage - (have to) act in a more than complicated manner. For this reason, despite the liability of the government, these COVID financings often require additional, further guarantees from the shareholders in connection with corresponding proof of creditworthiness.
The Ministry of Finance, politics or whoever needs to correct, re-sharpen or simply become more pragmatic. It has to happen quickly, otherwise it will be too late for many. It is simply tragic when orders come in again but at the same time production and procurement can no longer be provided.