Government continuing main COVID-19 crisis aid measures next year

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KredEx logo. Source: Social Media.

The government is to extend major support measures rolled out during the initial spring wave of the coronavirus, to 2021.

The cabinet made its decision Tuesday, meaning state credit agency KredEx, recently the subject of a critical report by the National Audit Office (Riigikontroll), the Rural Development Foundation (MES) and tourism-focused measures will continue as they are in the new year.

Prime Minister Jüri Ratas (Center), himself quarantining after a recent contact with a coronavirus carrier, said the state must support the economy during difficult times.

Ratas said via spokespersons: "The least we can do is make sure that after the crisis, a critical resource is left for as rapid as possible a recovery of economic activity."

The cabinet also approved raising the ceiling of compensation for crisis damaged from 30 to 50 percent when underwriting newly-issued bank loans.

Minister of Foreign Trade and IT Raul Siem (EKRE), who proposed the measure, said: "Although the economic decline after the beginning of the crisis has proved smaller than estimated, the new outbreak of coronavirus is pushing the recovery of the economy to a more distant future, due to which the need for businesses to survive the crisis with the support of the state continues."

Siem said as a result he had suggested the government carry funds granted to KredEx over to next year. The funds were granted as part of a supplementary budget issued in response to the pandemic in spring.

KredEx loans and types of loans are to be simplified as well, under the new measures, bringing the €500 million for operating capital loans, and €50 million for investment loans issued in spring, together under the one umbrella.

The Rural Development Foundation's loan underwriting, operating capital, investment loan measures, and its agricultural land financial lease measure are set to run next year.

Rural affairs minister Arvo Aller (EKRE) said: "Existing crisis measures of the Rural Development Foundation have been of great help for business operators, but the crisis is far ending any time soon, and business operators have a lot of uncertainty about the future."

BNS reports interest in the foundations sources of funding had been high; €79 million in loans, €29 million in loan underwriting, and €2.6 million in financial leasing had been concluded to December.

A €5 million reserve for tourism allocated on Novermer 10 will also continue next year, along with €3 million in rental support for businesses under the Enterprise Estonian umbreslla.

Raul Siem said the measure would help a sector blighted by the pandemic and in anticipation of the return of foreign tourists in significant numbers at some point.

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Editor: Andrew Whyte

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