Spain Unveils 11 Billion Euro Aid Package For Struggling Companies And Self-Employed
Spain News
Published: 25 February 2021 16:42 CET
Spain unveiled an 11 Billion Euro aid package on Wednesday to support companies and self-employed workers and mitigate the impact of the Coronavirus.
Prime Minister Pedro Sánchez said the package, which would be approved in the coming days, would help small and medium-sized businesses (SMBs) which have been hit hardest by the pandemic along with self-employed workers.
It is believed that the aid will be distributed in the coming weeks and focus primarily on tourism, hotels and restaurants.
With the tourism sector making up around 12.5% of the country’s GDP (Gross Domestic Product) it makes Spain the second-most visited country according to official data.
According to data published by the country’s national statistics institute (INE) this week, overnight stays in Spain’s hotels plummeted in January by around 85%.
The aim of the new financial measures is to improve the solvency of company balance sheets to help facilitate the return to stability for the economy.
In November, the government extended its 140 Billion EU recovery fund scheme until June, however, this was not sufficient enough to mitigate the impact the third wave has had on many businesses.
Sánchez said: “We don’t just want to save businesses and jobs. We want to create new businesses and jobs,” he told parliament.
Despite the number of Covid cases dropping in recent weeks and the cumulative number per 100,000 inhabitants now standing at 235, just below the ‘high-risk’ benchmark of 250, there is still a long way to go.
The region of Catalonia is especially of concern with health officials registering over 3,000 new cases on Wednesday thought to be due to the British, Brazilian and South African variants.
On Wednesday, Mr Sánchez said: “We are now all aware that the de-escalation after the first wave took place too quickly, precipitated by the need to reactivate the economy and alleviate emotional fatigue.
"We should not have dropped our guard during the Christmas holidays.”
Schemes to save jobs
One of the measures that the government has put in place is the ERTE (Expedientes de Regulación Temporal de Empleo) scheme, which has helped to minimise the number of redundancies. The scheme is currently assisting around 800,000 workers.
Under the scheme, the state provides workers with 70% of their salary and prohibits companies from firing staff.
Those who benefit from the scheme are considered to be employed rather than unemployed.
Spain’s unemployment rate hit 16.13% in 2020 with analysts claiming it to be the worst year for unemployment since 2012.
Source
https://www.euractiv.com/section/economy-jobs/news/spanish-government-announces-e-11-billion-direct-aid-package/
https://www.reuters.com/article/uk-health-coronavirus-spain-aid/spain-announces-11-billion-euro-package-to-help-companies-face-the-covid-crisis-idUKKBN2AO106
https://www.thelocal.es/20210224/spains-pm-eyes-11-billion-aid-package-for-struggling-companies-and-self-employed
Image Credit: Pool Moncloa / Borja Puig de la Bellacasa
