April 24, 2020 / 4:20 AM / a month ago

El Salvador offers loans, salary subsidies to ease coronavirus impact

SAN SALVADOR, April 23 (Reuters) - El Salvador’s government will offer more than a half a billion dollars in new loans to businesses, salary subsides and a new food program, officials said on Thursday, in a package aimed at easing economic pain caused by the coronavirus.

The government of President Nayib Bukele will work with main business associations to secure financing for up to $1 billion for the relief package, the finance and economy ministers told reporters as they announced the plan.

The lending portion of the package includes $360 million for low-interest loans for small and medium-size firms and $100 million for similar loans to businesses in the informal economy.

The package also features a salary subsidy for employees of small and medium-sized businesses equivalent to half of workers’ earnings each month, which is expected will cost some $140 million, plus a $50 million monthly food assistance scheme that will provide basics to 1.7 million families.

“The idea behind this program is to inject the liquidity that we need since we know this is one of the biggest challenges that our companies have faced,” said Economy Minister Maria Hayem.

The government loans and assistance, which will need to be approved by Congress, include a deferral on some taxes through June 30.

Health officials in the Central American country have confirmed 250 cases of the coronavirus, and eight deaths as a result of the highly contagious respiratory disease caused by the virus. (Reporting by Nelson Renteria; Writing by David Alire Garcia Editing by Robert Birsel)

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