News Local Government withdraws bill on state guarantees for loans

Government withdraws bill on state guarantees for loans

The government has decided to withdraw a bill that would have provided state guarantees for bank loans as the amendments proposed by the parties change its philosophy and render it impossible to implement, Finance Minister Costas Petrides said.

Speaking to reporters after a meeting of the Council of Ministers, Petrides said that from the first day there had been extensive consultations with political parties and the government had accepted a number of amendments despite its reservations.

But he said the new amendments render the bill impossible to implement.

He assured employees and the business world that he government will continue to support them with all means at its disposal and will next week announce policies and measures as part of a comprehensive support framework.

As initially approved by cabinet, the bill provided for:

– €300 m in guarantees for loans to very small companies

– €1 b for medium and large companies

– €200 m for very large companies

The loans will be given by the banks and will have a duration of three months to six years.

For very small companies, the guarantee will be covered 85% by the state and 15% by the banks and for medium sized and large companies 70% by the state and 30% by banks.

The bill was subject to the approval of the House of Representatives when the government has struggled to secure a majority without changes to the bill.

President urges party leaders to approve state guarantees bill

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