By The Star Staff
Economic Development Bank for Puerto Rico (EDB) President Luis Alemañy González announced Tuesday the designation of $20 million in funds under the State Small Business Credit Initiative’s (SSBCI) “Impulso a Tu Negocio” program that will be used to provide lines of credit for working capital to companies in the construction industry.
The announcement, which was made in conjunction with the Builders Association, said the funds are part of the $109.3 million granted to the EDB by the federal Treasury Department through the “Impulso a Tu Negocio” program. The initiative allocates federal SSBCI funds to capitalize on local programs to support small and midsize enterprises.
“Although at the moment there is an unprecedented amount of federal funds, there are many contractors requesting lines of credit in order to recruit employees, pay for payroll, operating expenses and utilities, and buy materials, with the aim of being able to complete the project and certify it for FEMA or CDBG-DR [Community Development Block Grant] to reimburse them,” Alemañy González said. “Not having the money beforehand, they cannot execute projects, federal funds are not used and contractors end up going bankrupt. The [building] contractor sector is one of the sectors with the greatest rate of bankruptcies along with the restaurant sector, among others.”
The EDB president added that “Governor Pedro Pierluisi has been emphatic that it is necessary to continue identifying resources to strengthen the construction industry, in order to promote economic development and expedite the infrastructure works that are being carried out throughout the island.”
The performance of the construction industry is a key mechanism for the development of any region since it creates and improves infrastructure, which increases fixed capital, impacting economic activity, local and foreign investment, and generating jobs, both direct and indirect, Alemañy González said. According to data provided by the EDB’s Center for Economic Studies, cement sales for February 2023 totaled 1,217,300 bags of 94 pounds, not seasonally adjusted, representing an increase of 3.4% compared to February 2022 and marking the third period of positive growth after three consecutive year-on-year reductions.