Financing of Desenvolve SP grows 25% in 2017

Disbursements totaled R$ 352.7 million in the year. Number of companies served more than doubled

 
The São Paulo economy is recovering. This is what the annual balance sheet of the Paulista Development Agency (Desenvolve SP) shows. The institution financed 25% more in 2017 than in 2016, recording R$ 352.7 million in disbursements in the period. With emphasis on the industry sector, responsible for almost half of the amount financed, all productive sectors registered high in the year. There was also a significant increase in the number of companies served and in working capital financing, which were essential for small companies to maintain their operations during the crisis.
 
“We expected a gradual recovery, with slower growth in 2017 and stronger growth in 2018. The rise of 25% was great, the result of intense work to encourage entrepreneurship throughout the year, always in line with the state government's development policies, and the improvement in macroeconomic numbers”, says Milton Luiz de Melo Santos, economist and president of Desenvolvimento SP.
 
Recovery in all sectors
 
Industry, the main borrower in 2017, required R$ 160.5 million in financing in the last twelve months against R$ 88.6 million in 2016, an increase of 79%. Among service providers, the increase was 69%. R$ 122.4 million were borrowed throughout 2017 against R$ 72.3 million in 2016.
 
The biggest positive variation, however, was presented by the trade, which jumped from R$ 15 million invested in 2016 to R$ 36.7 million last year, pointing to an increase of 145%. The remainder of the disbursements made by the agency in the last year, the equivalent of R$ 33 million, were destined to meet the needs of the public sector.
 
“With the successive drops in the basic interest rate, cheaper credit and a significant drop in inflation, companies have returned to invest to prepare for the reheating of the economy”, explains the economist.
 
More short-term and long-term investments
 
Regarding the types of investments made in 2017, credit for long-term projects, essential for companies to invest in gross fixed capital formation and expand their production capacity, represented 57% of the R$ 352.7 million disbursed by Desenvolvimento SP. The other 43% were required for working capital and financed inventory replenishments, raw material purchases and other operating expenses.
 
“Historically, disbursements for fixed investment represent the bulk of the agency's funding. However, it is important to note that the demand for working capital grew by 250% in 2017 compared to 2016, indicating another sign that entrepreneurs are preparing to grow again”, says Santos.
 
More companies financed
 
Also according to the balance sheet, the number of companies that sought out Desenvolvimento SP more than doubled, from 250 in 2016 to 543 in 2017. As for the size of the companies, 33% of the resources met the needs of small businesses, 55% for medium and 12% for big companies.
 
Regarding the destination of the financing, the interior of São Paulo continues to be responsible for demanding most of the agency's loans, injecting R$ 228.7 million into the economy between January and December of last year. The other R$ 124 million were invested by the São Paulo Metropolitan Region.
 
Innovation and Sustainability
 
Financing for innovation and sustainability, which also grew, are other highlights of the balance sheet. In all, SMEs invested R$ 49 million in innovative projects and R$ 36 million in green projects, representing 14% and 10% of the total disbursed in the year, respectively.
 
“These are numbers that show greater maturity on the part of the entrepreneur, who is increasingly aware that incorporating innovations and sustainable practices into the production and service supply chain is essential to guarantee the growth and perpetuity of the business”, says Santos.