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Many Latin America countries are announcing hefty support packages to keep businesses afloat during the economic downturn from the coronavirus, The Wall Street Journal reported. But Mexico’s nationalist leader is giving the private sector the cold shoulder, leading to growing friction between the government and business in the U.S.’s largest trading partner. President Andrés Manuel López Obrador has ruled out tax breaks or other kinds of help for businesses, saying those policies amount to a handout to the rich.
More than 45,000 mortgage payments breaks have been granted by banks or are close to completion, new figures show, The Irish Times reported. This is equivalent to 5 per cent of all mortgages in the Republic. Data from Banking Payments Federation Ireland shows close to 14,000 payment breaks for SMEs were granted or are in the process of being agreed over the past three weeks. In addition, banks are “well advanced” in processing 3,200 requests for working capital facilities, chief executive Brian Hayes. He said it has largely been SMEs seeking payment breaks to date.
The Indonesia Deposit Insurance Corporation (LPS) denied on Thursday media reports that its stress test had shown eight banks at risk of collapse under the government’s worst-case scenario for the economic impact of the coronavirus outbreak, Reuters reported. LPS Chairman Halim Alamsyah told an online briefing there were no indications any Indonesian bank would fail. “All banking indicators are normal and their fundamentals sound,” said Alamsyah, a former member of the Indonesian central bank’s board of governors.
Lebanon’s bondholders will have at least 70 per cent wiped off the value of their holdings, according to an analysis of the government’s plan to restructure the country’s huge debts, the Financial Times reported. Lebanon, which defaulted on its $30bn of foreign-currency bonds in February, offered the first hints as to how it plans to return its debt to a sustainable level in a draft document circulated on Wednesday.
British department store group Debenhams went into administration for the second time in 12 months on Thursday, seeking to protect itself from legal action by creditors during the coronavirus crisis that could have pushed it into liquidation, Reuters reported. With Britain in lockdown during the pandemic, Debenhams’ 142 UK stores are closed, while the majority of its 22,000 workers are being paid under the government’s furlough scheme. It continues to trade online.
Argentina will make an offer to its creditors “in the coming days” that will reflect the economic hit from the coronavirus pandemic, President Alberto Fernandez said in a newspaper interview. While debt talks are “going well,” calculations of debt sustainability will be affected by the impact of the virus, Fernandez was quoted as saying by Perfil. “The coronavirus affects debt renegotiation just as the coronavirus affects the entire global economy,” Fernandez said. “What we are going to sign is something that we can accomplish as a government and as a country.
The G20 group is planning to offer lower income countries a moratorium on bilateral government loan repayments as part of an “action plan” to tackle the coronavirus pandemic and stave off an emerging markets debt crisis, a senior G20 official said, the Financial Times reported. The initiative, due to be finalised at a finance ministers’ meeting this week, would see a freeze on sovereign debt repayments for six or nine months, or possibly through to 2021, in line with an appeal last month from the IMF and World Bank.
Germany’s economy, Europe’s largest, will probably shrink by 9.8% in the second quarter, its biggest decline since records began in 1970, due to measures imposed to slow the spread of the novel coronavirus, the country’s leading think tanks said on Wednesday, Reuters reported. That would be more than double the drop seen in the first quarter of 2009, during the global financial crisis, the economic institutes said. Germany has been in virtual lockdown for several weeks.
Italian government bond yields rose on Wednesday after European Union finance ministers failed to agree a rescue package to help economies recover from the impact of the coronavirus outbreak, Reuters reported. Diplomatic sources and officials said a feud between Italy and the Netherlands over what conditions should be attached to euro zone credit for governments fighting the pandemic was blocking progress on half a trillion euros worth of aid.