New financial package to help businesses weather the corona storm

Summary

To help businesses that are losing massive amounts of income due to the measures to limit Covid-19 infections, the government of Flanders is offering subsidies, loan guarantees and low-interest loans

Emergency fund for culture, sport

The government of Flanders has announced a new package of measures to help businesses survive the coronavirus crisis. The most significant for the self-employed and family-owned businesses is a subsidy of €3,000.

The new subsidy is for businesses that have continued to operate but will lose 60% or more of their income between mid-March and the end of April. While the Flemish parliament had already approved aid to businesses that were forced to close, many that did not have to close are losing a great deal of revenue during the quarantine.

The government hopes that the one-off “compensation premium” of €3,000 will stem the tide of small businesses that are shutting down and taking advantage of the overbruggingsrecht, a right to monthly benefits in times of hardship.

The subsidy can, in principle, go to any entrepreneur or small business that is suffering enough loss. But some of the sectors the government named specifically were the event sector, with the cancellation of all events in Belgium, and chocolate shops, which are not forced to close because they sell food but which have lost most of their customers to the quarantine and travel ban.

We want to do as much as we can, especially for those who in recent years had the courage to start their own businesses

- Minister-president Jan Jambon

The premium could also go some way to preventing more small businesses from putting staff on temporary unemployment. Flemish minister-president Jan Jambon told VRT that he was concerned about the number of self-employed people and small businesses who were claiming benefits and laying off workers rather than riding out the crisis.

The government will “never be able to compensate all losses, there is simply not enough money for that,” Jambon said today as the new benefits were announced. “But we want to do as much as we possibly can, especially for those who in recent years had the courage to start their own businesses.”

Other aid announced today include:

  • A doubling of the loan guarantees that the government is offering to companies needing to borrow from banks, from €1.5 billion to €3 billion. These guarantees are offered to corporations that need to borrow to bridge the gap
  • €250 million for low-interest three-year loans for start-ups and scale-ups
  • A €200 million emergency fund for sectors such as culture, sports, media and youth centres

“The millions that we have made available are to tide us over – to build a bridge from difficult to better times,” said Jambon. “The ship that steers our economy is battling a storm, but, with all hands on deck, we will get the better of it and sail into safe waters again.”

He concluded his statements today by giving a shout-out to hospital workers across the region. “They are an inspiration, working overtime in extremely challenging circumstances. Hopefully, all of Flanders will soon be able to return to work and do their best to ensure our welfare. I call on everyone to help in that effort.”

Photo: Charlotte Gekiere/BELGA