Lithuanian businesses that have suffered difficulties due to China’s sanctions can now apply for working capital loans, the Economy Ministry has announced.
A stimulus financial facility prepared by the Economy and Innovation Ministry was launched on June 15, allowing businesses that suffered from China’s actions to receive loans of up to EUR 5 million, and groups of companies up to EUR 10 million, with a total planned budget reaching EUR 130 million.
China introduced unannounced sanctions and a de facto economic blockade after Lithuania began forging closer ties with Taiwan.
The European Commission previously approved the financial facility “Direct loans to businesses affected by the actions of third countries”.
“Lithuania is the first EU country to have developed and agreed with the EC a completely new financial facility scheme to help businesses that are in difficulty due to the actions of third countries,” said Economy and Innovation Minister Ausrine Armonaite.
“It is important to note that it is not only for Lithuanian businesses that have already suffered at the hands of China because of our country’s principled stance towards Taiwan but also for other EU countries that may face economic pressure in the future,” she said.
Armonaite hopes that “the possibility to borrow working capital will allow businesses to search for and discover new markets, partners and export destinations”.
The loans will be open to companies whose share of imports or exports with China in 2021 was at least 25% of their total imports or exports.
They will be granted preferential terms for a maximum period of 24 months, including a grace period of no more than six months from the contract’s date. The loans will be administered and provided by UAB Investiciju ir Verslo Garantijos” (INVEGA). (LRT/Business World Magazine)