France to Guarantee $335 Billion of Bank Loans, Macron Says
(Bloomberg) -- France will guarantee up to 300 billion euros ($335 billion) of bank loans to companies in an effort to bolster firms threatened by the impact of the coronavirus outbreak, President Emmanuel Macron said.
The government will also allow companies to delay paying their taxes and social security contributions and provide support to help them delay loan payments, Macron said in a televised address Monday. The president said he’s halting all reforms -- including his controversial pension reform -- to focus on tackling the coronavirus.
“We are at war, and all government and parliamentary forces must be focused on fighting the epidemic,” he said. “Day and night, nothing shall disturb us. That’s why reforms will be suspended, to begin with the pension reform.”
The package is Macron’s latest effort to limit the economic damage from the outbreak, “whatever the cost” and comes after Germany lined up as much as 550 billion euros of emergency loans to companies. Other measures will include stricter curbs on people’s movements for at least two weeks and sanctions for those who flout the restrictions, he said.
Read more: Macron Invokes War as Europe Goes Dark in Coronavirus Fight
The loan guarantees come in addition to plans already announced to expand guarantees for loans to small businesses using the state investment bank BPI. An official at the Finance Ministry said that the new pledge Macron unveiled is for all cash-flow loans to any company.
“With this decision, no business should run into financing difficulties in the coming months,” the Finance Ministry said.
The interior minister detailed new curbs to non essential travel, warning that it won’t be possible to go out without a valide justification and not be at risk of a fine. Macron also said the state would guarantee that workers maintain their purchasing power, adding that “nobody” could foresee how long the situation could last.
The push to overhaul the French public pension system is one of the flagship reforms of Macron’s presidency and provoked rolling strikes from early December that paralyzed transport in Paris at times. While protests have been dying down, anger has remained palpable as a series of recent polls have shown the president’s popularity dwindling.
The second round of France’s municipal elections will also be postponed, Macron said. The first round Sunday had been challenging for Macron’s three-year-old party, and turnout low as voters feared for their health.
Read More: Macron’s Challenger for Paris Mayor Falters in Virus-Hit Ballot
After the European Union proposed a temporary halt to non-essential visits to Europe and restrictions to outgoing travel, Macron said EU borders would close from Tuesday for at least 30 days.
(Updates with details of measures from fifth paragraph)
--With assistance from Gaspard Sebag and Geraldine Amiel.
To contact the reporters on this story: Ania Nussbaum in Paris at anianussbaum@bloomberg.net;William Horobin in Paris at whorobin@bloomberg.net
To contact the editors responsible for this story: Ben Sills at bsills@bloomberg.net, Alan Crawford
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