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| - Governments and central banks are injecting eye-popping sums and emergency policy remedies into the global economy as the coronavirus pandemic upends all normal life. Markets have crashed as world growth faces its biggest crisis since 2008, and have largely shrugged off the stimulus efforts as the outbreak engulfs the West. Asian equities sank again Thursday while stocks in Europe rebounded after a new initiative from the European Central Bank (ECB), which has faced criticism for not acting more aggressively so far. AFP surveys responses by major economies as the coronavirus has spread from China to infect the rest of the world, enforcing national lockdowns and crippling businesses: After China, Europe is now the epicentre of the COVID-19 coronavirus outbreak and governments have scrambled to open the spending taps while also closing their borders. The ECB on Wednesday announced a surprise 750-billion-euro scheme to buy government and corporate bonds, boosting funds in the system so as to help contain the economic damage from the virus. The eurozone bank is reviving crisis-era measures to encourage bank lending to companies, but caused some disquiet last week by keeping its borrowing rates on hold. EU finance ministers had pledged Monday to fight the coronavirus "war" but declined to tap the European Stability Mechanism, the eurozone's 410 billion euros war chest. Debate has also begun among eurozone members about creating "coronabonds", which would be the first time members break a taboo about pooling their debts. Individual European countries have stepped up with their own plans, with Chancellor Angela Merkel warning Wednesday that Germany faces its biggest test since World War II. Berlin has unveiled 550 billion euros in government-backed loans "for starters", and suspended legal obligations for firms facing acute liquidity problems to file for bankruptcy. British finance minister Rishi Sunak on Tuesday unveiled an "unprecedented package" of government-backed loans worth £330 billion ($400 billion). President Emmanuel Macron of France, which is now under total lockdown, said Monday the government would ensure that all bank loans to companies are backed by a state guarantee totalling 300 billion euros. The French government announced a separate aid package worth 45 billion euros to help businesses and employees cope. In hardest-hit Italy, the government promised to deliver a "very strong injection of liquidity" into the financial system to generate 340 billion euros ($380 billion) in cash flows. Spain plans to guarantee up to 100 billion euros in corporate loans. On Tuesday, US Treasury Secretary Steven Mnuchin said officials were drawing up a package that could surpass $1 trillion, on top of $300 billion in deferred tax payments. The measures -- far surpassing aid during the 2008 financial crisis meltdown -- are likely to include direct cash payments to struggling families. The package is in addition to $100 billion directed at paid sick leave and expanded unemployment benefits signed into law by President Donald Trump on Wednesday. A bailout for US airlines could also be in the works, after Mnuchin said they face a crisis now "worse than 9/11". The Federal Reserve has taken interest rates down to virtually zero, and massively increased cash injections into financial markets, including an additional $1.5 trillion last week and $1 trillion so far this week. The US central bank also unveiled a new credit facility to help households and businesses stay afloat, while President Donald Trump has shifted his tone after downplaying the outbreak for weeks, now appealing for bipartisan support. Trump ordered the suspension of evictions and mortgage foreclosures for six weeks as part of the government effort to ease the pain. Canada on Wednesday announced an aid package of Can$27 billion (US$19 billion) plus more in tax deferrals, and has also cut interest rates. The International Monetary Fund is making $50 billion available for poorer countries, and has appealed for a "global response" of the kind seen after the 2008 crash. G7 leaders including Trump on Monday vowed to "do whatever it takes, using all policy tools" to safeguard growth, but offered no concerted action plan. G20 nations rallied together to combat the 2008 crisis, but the group has been absent from the triage effort so far this time. Saudi Arabia, which holds the G20 presidency, is calling for an extraordinary leaders' summit next week. As with all other gatherings now, it would be in "virtual" format. China, ground zero of the virus outbreak with more than 3,000 deaths, has cut interest rates and vowed a range of measures including tax cuts and more fiscal transfers from Beijing to virus-hit regions. New Zealand Tuesday raided its "rainy day" fund to release NZ$12.1 billion (US$7.3 billion) in stimulus spending. Last week, Australia unveiled a US$11 billion spending plan -- equivalent to just under one percent of GDP -- to help avert its first recession in 29 years. On Thursday its central bank also cut interest rates to record lows. Japan, which faces a huge financial hit from the possible postponement of the Tokyo Olympic Games this summer, is offering at least $15 billion in loan programmes for firms. Hong Kong's government is giving a cash handout to every permanent resident, with a recession brought on by months of political protests now exacerbated by the coronavirus. jit-burs/bmm
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