Wed, May 07, 2003 - Page 4 News List

Cabinet ratifies SARS economic assistance plan

BORROWING The plan forbids banks to charge more than an annual interest rate of 2.675 percent on loans that can be used to cover expenses

By Ko Shu-ling  /  STAFF REPORTER

In a bid to help industries affected by severe acute respiratory syndrome, or SARS, better cope with the financial plight caused directly and indirectly by the outbreak, the Executive Yuan yesterday decided to provide fiduciary loans and interest subsidies to the industries affected.

"The government is obliged to offer assistance to the industries affected by SARS because since the outbreak began in March, international air travel has seen a 50 percent decrease and domestic air travel fell 36 percent," said Ho Mei-yueh (何美玥), vice chairman of the Council for Economic Planning and Development.

As it may take awhile for the outbreak to subside, it is necessary the government offer short-term bail-out programs to help industries affected by the outbreak to solve their financial plight, Ho said.

Ho made the remarks after the closed-door inter-ministerial meeting held at the daily Executive Yuan to discuss the impact of SARS.

To help industries which are having difficulties paying their employees' salaries, Ho said that the government has signed contracts with the nation's 41 financial institutions to offer fiduciary loans.

Applicants meeting certain criteria can borrow funds from the contracted banks until July 31. The accumulated ceiling of the loan is NT$20 million per company.

Financial institutions offering the loans are forbidden to charge more than 2.675 percent -- the annual interest rate. Once approved, the money will be directly wired to the employee's bank account.

The debtor can wait until January next year to start paying back the money they borrow.

To be eligible for the program, applicants have to prove that their business has dwindled by 30 percent since March .

Also eligible are those busi-nesses ordered to be sealed off by the government and forced to suspend operations .

The tourism industry, hotel-iers, or shops located in resort hotels or airports are also eligible to apply.

To help the tourism industry ease their financial burden, the government will provide 4 percent interest subsidies to those whose loan applications are approved between April 1 and July 1 this year. The ceiling of the loan is set at NT$1 million.

To help small-and-medium businesses borrow money from financial institutions, the government will set up a task force to offer professional help.

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