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February 10, 2020

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Home » Business » Finance

US$43b boost for firms fighting epidemic

CHINA’S central bank said yesterday it will offer a 300-billion yuan (US$43 billion) boost this week to help businesses involved in fighting the virus epidemic which has swept China and infected thousands.

The outbreak, which started in the central city of Wuhan, has brought large swathes of the country to a halt and threatens to dampen the country’s already slowing economy.

The People’s Bank of China said it will offer the first tranch of special re-lending funds today, which it said will support financial institutions to give loans to key firms involved in the prevention and control of the epidemic.

PBOC deputy governor Liu Guoqiang said that nine major national banks, as well as local banks in 10 provinces and cities, qualify for the special funding, according to a speech posted on the bank’ website yesterday.

These 10 areas include Hubei — the epicenter of the outbreak — Zhejiang and Guangdong provinces, Beijing and Shanghai.

The financial boost is aimed at helping companies at both national and local level, Liu said.

He stressed that “financial institutions need to review and issue loans quickly,” and that they should also release funds within two days.

The deputy governor added that the central bank will track the use of the funds and anyone found flouting the rules will be penalized.

He also said the scope of key enterprises “should not be too wide.”

The deadly coronavirus has claimed over 800 lives in China and spread around the world.

To curb the epidemic, cities in China have imposed travel restrictions and urged citizens to stay home, and companies have delayed the resumption of work — moves that could take a toll on earnings.

The central bank has called on financial institutions to avoid “blindly” cutting off loans from industries, as well as small and micro enterprises.

The PBOC also announced earlier that it would pump 1.2 trillion yuan into financial markets as it ramped up support for the virus fight.


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