The Council of Ministers approved this Tuesday a new tranche of 20,000 million euros from the line of guarantees of the Official Credit Institute (ICO) that the Government approved to guarantee the liquidity of companies and the self-employed. The activation of the new section was already announced at a telematic press conference by Pedro Sánchez from La Moncloa last Saturday. Sánchez stressed thatmore than 90% of the lines of previous guaranteesthat have been approved have been addressed to SMEs and the self-employed. At least 50% of the new section will also go to these two groups.
This new line of guarantees, for an amount of 20,000 million, is the fourth one approved by the Government, with which the joint amount rises to84,500 million on the total of 100,000 million assumed by the Executive. The Minister of Finance and government spokesperson, María Jesús Montero, highlighted at the press conference after the Council of Ministers, that the numbers of the measures undertaken “clearly reflect that the Government prioritizes SMEs and the self-employed in economic measures that sets it in motion. ” In this sense, he recalled that 60,000 million euros have been reserved for these groups of the 84,000 million that have been released so far.
According to the latest compliance figures provided by Montero, ICO guarantees have so far 394,543 operations,98% made with SMEs and freelancers,It has mobilized guarantees worth 39,631 million euros, which has allowed injecting 50,922 million into the productive fabric, the spokesperson has summarized.
The Governor of the Bank of Spain, Pablo Hernández de Cos, defended yesterday in his appearance at the Congress Economic Commission, that this is one of the most important measures that have been put in place to mitigate the economic effects of the pandemic and that all developed countries have used this type of guarantee. This mechanism, in his opinion, contributes to “a ‘shock‘Temporary does not end up generating permanent effects’, so that companies’ liquidity problems do not become solvency problems. He also defended the role of supervisor so that banks do not behave recklessly.
Hernández de Cos explained that the figure of 100,000 million, which is already close to being reached, corresponds to a calibration by the Bank of Spain of the calibration of theliquidity needsof the companies planned for two quarters.
The governor recalled on Monday that the volume of guarantees granted in Spain represents 2.2 points of GDP. In the German case they donate 1% and in Italy they represent 1.4%. “And that has to do with therole of the banking sector“He recognized, however, that the execution of a plan with so many companies is very complicated and even so the ability to mobilize this money is being very agile.
The Prime Minister was somewhat tougher on the banks last Saturday in asking the financial sector to be “dynamic and agile enough” for the guarantees to arrivemainly to SMEs and freelancers“They are the ones who need it the most,” he said.