We Can Ask Calvino To Launch A Package Of Direct Aid To Businesses To Ease The Crisis

2021-02-01   |   by CusiGO

Mario Draghi, a former president of the Bank of Spain, European institutions and even the European Central Bank and one of the latest crisis figures, has warned that the government is preparing a series of measures to ease the wave of corporate bankruptcies that may start in the spring. Part of the executive branch demands greater ambition: we can put pressure on the economy to launch a program of direct aid to businesses, especially in the hardest hit sectors, where some socialist ministers acknowledge that Spain is on the path. The Treasury just cut $10 billion in debt in 2021. “The economy needs an extra because the next semester will be bad; ideally, it will use $10 billion,” notes Mabel, Nacho Alvarez, who is in charge of the economy. Economic sources said the figure was never passed on to the vice president. But the debate is there.

A small number of partners in the coalition of governments support an “immediate” increase in direct aid, particularly to the hotel industry. There are two different aspects: those who believe that 2021 will be a year of strong recovery and point out that Spain has done enough on the fiscal front, and those ministers who are looking forward to economic recovery, who hope to strengthen the stimulus measures stipulated in the budget within six months, which is more difficult than expected, In this regard, neither the vaccine nor the European fund, the two engines of recovery, have yet come into effect. As the country said yesterday, but at least part of the Council of Ministers is in favour of raising the ambition of the package by providing direct assistance to businesses, as other European partners have done, as employers and the people’s party have demanded, as well as the Bank of Spain and the International Monetary Fund.

This debate has been repeated many times within the government, especially within the delegation of the Economic Affairs Committee. In the process of discussing the hotel plan, it was very intense. Because of this dispute, the hotel plan was delayed several times. Reyes maroto, Minister of industry, is one of the countries that most emphasize the need to approve direct aid, as are other countries, especially Germany. Finally, he came up with a compromise that won wide support in Congress last week.

The strongest silence comes from the vice president of the Ministry of economy and the Ministry of finance, who insist that the most powerful aid to enterprises is ETS, which means that the state bears wages or reduces contributions. The executive also launched a $10 billion package a few months ago to tap into the capital of strategic companies. But some governments insist that more needs to be done and point out that the Treasury plans to cut $10 billion in public debt this year.

There’s an old economic adage that there’s no free lunch, but it’s not: it’s a matter of saving the next six months until the epidemic data improves and European funding starts to come in, but at the cost of more deficits. We can point out with the International Monetary Fund (IMF) and other institutions that this is not the time to worry about the financial situation, but the party leading Pablo Iglesias is not the only one to make such a request. Trade unions and employers have repeatedly sent this message. Even in the socialist camp of the Council of ministers, some people think that Spain has done relatively little.

Moncloa supported vice president Nadia Calvi รณ o: “according to sources consulted, the financial package has been strong, supporting businesses and workers through Erte and ICO, and the economic sector is responsible for matching measures to the economic situation.”. However, the debate opened the way in the Council of ministers and the PSOE, as it was found that a moderate recovery in the fourth quarter could give way to several complex months. Economics also believes that in addition to SEPI’s 10 billion euro strategic business, the direct assistance program also includes measures in ETS, self-employed and hotel programs. With regard to social security contributions, credit lines and ICO guarantees, the Ministry believes that the Spanish government’s assistance is the highest level in Europe. But according to the European Commission, Spain is in the lead in discretionary spending measures.

In any case, the administration, which is most opposed to direct aid, makes it clear that economic development, especially the viability of commercial structures, has been under consideration. The same source pointed out that the $10 billion was necessary because Spain currently had no problems with its debt. They also insist that ETS costs the executive a lot, even more than any form of direct aid, and argue that the complexity of autonomous states is the reason for rejecting ETS. Autonomous regions are entitled to such direct assistance, and some are already providing it.

In any case, the debate is not over. The forecast was taken aback by the violent impact of the third wave. Even the most resilient admit that such assistance may be the only option in a few weeks.