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Brazil taps $8bn for small businesses hit by COVID-19

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Brazil taps $8bn for small businesses hit by COVID-19
Brazilian President Jair Bolsonaro

Brazilian President Jair Bolsonaro said Friday the government will extend 40 billion reals (nearly $8 billion) in low-interest loans to small businesses hit by the coronavirus pandemic.

Small and medium-sized businesses hit by COVID-19 containment measures will be able to take out loans at 3.75 percent interest — well below the market rate of around 20 percent — to cover two months of salary for their employees, provided they make no layoffs during that time.

“Our concern is preserving jobs. We’re facing two destructive waves: first coronavirus, then the economic impact. We’re doing all we can to reduce the size of those waves,” the far-right president told a news conference.

The government estimates the program will benefit 1.4 million companies and 12.2 million workers.

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The measure comes after Brazil’s lower house passed a bill Thursday to make direct payments of around $120 to all Brazilians who work in the informal sector or are unemployed, seeking to cushion the blow of the COVID-19 crisis.

That was three times the Bolsonaro administration’s initial proposal.

Bolsonaro has faced criticism for his handling of the new coronavirus, which he compared to a “little flu.” He has repeatedly condemned “scorched-earth” containment measures by local authorities such as closing businesses and schools, which he warns is wreaking havoc on Latin America’s biggest economy.

On Thursday he issued an online call for drivers to take to the streets in protest against such social distancing measures, with the slogan “the people want to work.”

However, only around 20 drivers took part in a first such protest Friday in Sao Paulo, the economic capital and epicenter of the coronavirus outbreak in Brazil.

[AFP]

Vanguard News Nigeria.

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