Switzerland announces $ 32.6 billion aid deal as virus puts country ‘back to wall’



ZURICH (Reuters) – Switzerland has announced a new 32 billion Swiss francs ($ 32.56 billion) aid package to support businesses and workers affected by the worsening coronavirus outbreak that has driven the country to take “drastic measures”.

FILE PHOTO: A pedestrian wearing a mask crosses the Italian-Swiss border during the coronavirus (COVID-19) outbreak, in Chiasso, Switzerland, March 9, 2020./File Photo

The government has also banned gatherings of more than five people as it ramps up its response to the outbreak that has left 43 people dead and forced businesses across the country to shut down.

The measures fall short of the full lockdown introduced to prevent the spread of the virus in neighboring Italy, which has borne the brunt of the pandemic in Europe.

“We are not blocked yet, but we are close,” Swiss Minister of Health Alain Berset said at a press conference in Bern.

“We are back to the wall now and we have to show that we are up to the challenge.”

Until now, many people had not taken the situation seriously enough and continued to gather in large groups, he said.

“To be concrete, from midnight tonight, any group of young people meeting at the train station in Bern, Geneva or Lausanne can be fined 100 francs each,” Berset said.

The package follows the 10 billion franc one announced last week to cushion the expected slowdown caused by the virus.

The measures are aimed at maintaining jobs, protecting wages and helping the self-employed, the government said. Most of the money – 20 billion francs – will go into guarantees for bank loans to businesses in what Finance Minister Ueli Maurer called “very modest” interest rates.

Companies will be able to obtain loans of up to 10% of their turnover, up to a limit of 20 million francs. Sums of 500,000 francs will be paid immediately and guaranteed by the government. She expects loans of up to CHF 500,000 to cover more than 90% of businesses.

The government’s partial unemployment scheme – which compensates for lost wages – would also be extended to fixed-term, temporary and intern workers, he said.

Swiss credit CSGN.S welcomed the loan guarantee system.

“We will work with our customers to ensure that the guarantee system is implemented as quickly and as less bureaucratically as possible,” said Andre Helfenstein, head of its Swiss business.

The aid plan comes after government economists warned on Thursday that Switzerland would be dragged into a recession this year, while the country has also started rationing drugs to avoid panic buying and has mobilized up to 8 000 members of his army.

The number of coronavirus cases in Switzerland and Liechtenstein increased by 952 in one day to reach 4,840 people, Swiss health authorities said, with 43 dead.

Maurer said it was crucial that the money be available quickly and easily, but that helicopter money – direct payments to households to stimulate the economy – was not necessary.

“We support the economy. If he needs more resources, we will provide them, ”he said.

Reporting by John Revill, Stephanie Ulmer-Nebehay, Silke Koltrowitz, editing by Ed Osmond


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