The European Commission will spend €100 billion to financially support businesses affected by the pandemic, by providing their employees with income support.
The funds will be loaned to 17 out of 28 Member States. Each country will then invest locally in so-called short-time work schemes. The schemes can be employed when businesses have to cut back working hours for staff, but still want to be able to pay out full wages.
The recipient countries are Belgium, Bulgaria, Croatia, Cyprus, Czechia, Greece, Hungary, Italy, Latvia, Lithuania, Malta, Poland, Portugal, Romania, Slovakia, Slovenia and Spain.
The measure is part of the Commissions’s SURE framework (European instrument for temporary Support to mitigate Unemployment Risks in an Emergency). SURE was founded to help support Member States to save jobs during and after the pandemic.
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SURE will issue the €100 billion in the form of social bonds, which ensures investors that their investment can and will only be spent on the preservation of jobs.
In total, Belgium will be granted €7.8 billion in financial support through SURE. Loans vary between €27.4 billion (for Italy) and €504 million (for Hungary).
We are investing €100 billion to save jobs in Europe, and we are doing it by issuing social bonds.
This will give investors the chance to contribute to our efforts to reduce the social impact of the pandemic. Money will soon flow to 17 EU countries, to keep people employed. https://t.co/LkjMDKNZSo — Ursula von der Leyen (@vonderleyen) October 7, 2020
“I am very excited about today's announcement and looking forward to the forthcoming EU SURE issuance in the very near future,” Commissioner for Budget and Administration, Johannes Hahn, stated.
The first transaction of funds will take place in the second half of October.
Amée Zoutberg
The Brussels Times
