March 9, 2020 / 12:30 PM / 21 days ago

Greece takes relief measures to ease coronavirus's impact

ATHENS, March 9 (Reuters) - Greece announced financial relief measures for companies in areas hit by the coronavirus, in a bid to safeguard jobs and boost liquidity, the country’s finance minister said on Monday.

The measures include a deferment on value-added tax (VAT)payments and social security payments due at the end of March.

Greece has 73 confirmed cases of coronavirus infection but no fatalities yet, a relatively low toll for Europe.

“The spread of the coronavirus has adverse effects on health and the economy. The impact is more serious than initial estimates,” Christos Staikouras told reporters.

The government has banned public gatherings in three districts in the south-west of the country and ordered schools there to remain shut until further notice.

Companies operating in areas afflicted by the coronavirus outbreak, which shut down for at least 10 days, will get a four-month extension to pay VAT that falls due at the end of March, the minister said. The deadline for social security payments will be similarly extended.

The government will increase the health ministry’s budget by 15 million euros ($17.14 million) to cover increased payroll and intensive-care-related costs at hospitals, Staikouras said.

The government will also encourage employers to consider work-from-home initiatives and adjust shifts to help contain the coronavirus spread.

Greek economic growth could slow to 2.21% or 1.88% this year, the country’s fiscal council projected last week. That means the government may need to look for budget “cushions” for possible extraordinary spending on health.

Staikouras said strict European Union budget rules should be loosened to allow more fiscal room for manoeuvre to help tackle the coronavirus crisis.

The leader of Italy, the country worst hit by the epidemic, made the same argument on Monday. Italian Prime Minister Giuseppe Conte called for looser EU rules and more flexibility. So did French Finance Minister Bruno Le Maire, who urged coordinated action across the EU. ($1 = 0.8754 euros) (Reporting by George Georgiopoulos)

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