European Commission backs German €500bn coronavirus fund

The European Commission on Wednesday approved German plans to set up a €500bn fund to support businesses affected by the coronavirus crisis. The decision brings the total of German approved funds to € 600bn, as the EU's executive arm previously has given its nod to €100bn in funds, dpa reported.

Margrethe Vestager,   Commission’s Vice-President in charge of competition policy, said the funds contained sufficient safeguards to limit distortions of competition. "In these difficult times, we continue to work in close cooperation with member mtates to find workable solutions to facilitate the access to finance of companies affected by the coronavirus outbreak, in line with EU rules," she said.

Under the plans, only companies that were not already considered to be in difficulty at the end of last year are eligible for aid. The support will take the form of guarantees, amounting to the lion share of €400bn, as well as subsidized debt instruments and recapitalization instruments.

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