2020.03.24 16:00

Lithuanian government to extend €2bn aid package to ‘responsible businesses’

BNS2020.03.24 16:00

The Lithuanian government has put together a 2-billion-euro financial package to help businesses bounce back from the coronavirus-induced economic crisis.

The package includes “grants, guarantees and other financial instruments,” Finance Minister Vilius Šapoka told reporters on Tuesday.

Read more: Around 32,000 businesses in Lithuania offered tax breaks

Lithuania introduced a nationwide quarantine on March 16, forcing most customer-servicing businesses to close down. The Finance Ministry has said that the country's coronavirus-hit economy may shrink between 1.3 and 2.8 percent in 2020.

Šapoka said on Tuesday that the financial assistance would be available to “businesses that have come to a complete halt, those that are facing difficulties, and those that see new opportunities and want to invest”.

“The package covers all of them,” the minister said.

Read more: Lithuania extends 90-percent subsidies to keep jobs during coronavirus downtime

The sum is “impressive”, according to Šapoka, and offers “opportunities for businesses to deal with liquidity issues as well, and to seek new investment opportunities and expand their customer base if they see new niches in the face of quarantine”.

He noted, however, that only “responsible businesses” would be able to make use of the government's financial assistance, meaning those that are not firing their employees during downtime or forgoing on their obligations to suppliers.

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“All the support is only available to responsible businesses that care about their employees and partners,” he said. “Only by acting in solidarity can we salvage the economy and to quickly put it back on track.”

EU bailout fund

Šapoka also said he expected EU finance ministers to approve a eurozone bailout fund to mitigate the economic impact of the coronavirus pandemic.

“The European Stability Mechanism currently has a joint borrowing potential of 400 billion euros. Lithuania supports that initiative,” he said at the news conference on Tuesday.

“I believe we are going to find an agreement today.”

The minister acknowledged that not all countries were “overjoyed” at the proposal, but said he believed that a compromise would be achieved “for the benefit of solidarity”.

EU finance ministers are to discuss joint borrowing initiatives in a teleconference on Tuesday evening.

Read more: Lithuanian president backs eurozone's ‘coronavirus bonds’