Spain to approve 50 billion aid package for companies, PM says

Spain to approve 50 billion aid package for companies, PM says
  • Clock-gray 01:52
  • calendar-gray 03 July 2020

Spain will approve 50 billion euros ($56.4 billion) as part of a new set of measures aimed at boosting companies’ investment capacity and solvency in an attempt to revive the coronavirus-hit economy, Prime Minister Pedro Sanchez said on Thursday, APA reports citing Reuters.

The announcement was part of other proposals such as tax reform partly focused on raising taxes on larger companies rather than smaller ones.

Sanchez said in an interview with La Sexta on Thursday that the new measures were “linked to (boosting) solvency and investment.”

A government source said earlier that Spain would approve this package at an extraordinary cabinet meeting on Friday.

“Measures are aimed at improving the financial structure of companies to also lower their risk of defaulting on their payments with lenders,” the source said, adding that financial instruments were still being discussed.

In March, the government approved state-backed credit lines of up to 100 billion euros to help support mainly small and mid-sized companies and self-employed against the fallout from the pandemic.

Last month, Bank of Spain Governor Pablo Hernandez de Cos said mechanisms were needed to encourage the growth of small and mid-sized companies to reduce their higher borrowing costs compared to European peers.

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