Sat, Mar 28, 2020 page10

• World Business Quick Take

  • Agencies
  • • 
    • 
    • 

  MALAYSIA

  New stimulus tops US$57bn

  The government yesterday announced a stimulus package worth 250 billion ringgit (US$57.54 billion), its second in a month, to help cushion the economic blow from the COVID-19 pandemic. The package largely includes one-off payments and discounts on utilities for people whose livelihoods have been affected by the pandemic, and to help small and medium-sized enterprises stay afloat and retain their staff. The plan includes a 50 billion ringgit loan scheme for larger companies, which would offer guarantees of up to 80 percent of the sum borrowed to shore up working capital in the corporate sector. About 128 billion ringgit would be spent on public welfare measures, with 100 billion used to support businesses. The package is in addition to a 20 billion ringgit stimulus plan announced last month.

  EUROPEAN UNION

  ‘Corona bonds’ opposed

  Germany remains opposed to the idea of so-called “corona bonds” that would pool the debt of 19 eurozone countries in response to the coronavirus crisis, German Chancellor Angela Merkel said on Thursday. Speaking after a video conference with other EU leaders, Merkel rejected the proposal backed by countries including France and Italy. “From the German side and from other sides, we said that this was not the view of all member states,” Merkel said, adding that the existing European Stability Mechanism (ESM) was her “preferred instrument.” She admitted that EU leaders had discussed “whether the ESM contains enough possibilities, and how strong and quick our answer must be.” The existing ESM bailout fund is unpopular in southern European countries such as Italy, as it effectively makes financial aid conditional on economic restructuring.

  UNITED STATES

  Fed’s balance sheet rising

  The Federal Reserve’s balance sheet reached US$5.3 trillion in assets for the first time this week as it scooped up bonds and extended loans to banks, mutual funds and other central banks in its unprecedented effort to backstop the economy in the face of the COVID-19 pandemic. The Fed’s total balance sheet size rose by more than half a trillion dollars in a single week, roughly twice the pace of the next-largest weekly expansion in the financial crisis in October 2008. The Fed bought US$355 billion of Treasuries and mortgage-backed bonds in the last week in what is now an open-ended commitment to stabilize financial markets rocked by the outbreak and the halt in economic activity that has come in its wake.

  AIRLINES

  Singapore secures funding

  Singapore Airlines Ltd said it had secured up to S$19 billion (US$13.24 billion) of funding to help see it through the coronavirus crisis and expand afterward, in a sign of confidence travel demand would eventually return. The airline’s majority shareholder, state-fund Temasek Holdings, said it would underwrite the sale of shares and convertible bonds for up to S$15 billion. Singapore’s biggest bank DBS Group Holdings Ltd provided a S$4 billion loan. “This transaction will not only tide [Singapore Airlines] over a short term financial liquidity challenge, but will position it for growth beyond the pandemic,” Temasek International chief executive Dilhan Pillay Sandrasegara said. The airline, a major customer for Airbus SE and Boeing Co, has cut capacity by 96 percent and grounded almost its entire fleet after the Singaporean government banned foreign transit passengers.
• Most Popular

  • 1

    LA Dodgers show off World Series rings

  • 2

    Hong Kong Sevens settles into new Kai Tak Stadium

  • 3

    Dodgers edge Tigers and Yankees beat Brewers in opening games in the US

  • 4

    US hands over first long-awaited F-16

  • 5

    Huge 7.7 quake rocks Thailand and Myanmar