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International Internet Magazine. Baltic States news & analytics Tuesday, 26.05.2020, 08:42

NIB provides Covid-19 mitigation loan to Republic of Latvia

BC, Riga , 09.04.2020.Print version
The Nordic Investment Bank (NIB) and the Republic of Latvia have signed a 10-year loan agreement of EUR 500 mln to finance additional government expenditures from mitigating the impact of the coronavirus Covid-19 pandemic.

The Covid-19 mitigation loan will cover a part of Latvia's increased expenditures, primarily:

·     Support measures for employees, rescheduled tax measures and reduction of rent.

·     Further possible economic stimulus measures such as capital injections, extra measures for the most affected business sectors, potentially additional support for small and medium-sized enterprises in the form of working capital or guarantee mechanisms.

·     Providing protective equipment and anti-infectious agents, medical equipment, disposable personal protective equipment, medicinal products, single-use materials, non-invasive ventilators, and remunerations for medical persons performing all necessary prevention and treatment measures related to the spread of Covid-19. 


"The Latvian Government is working on a fiscal stimulus package and developing financial instruments to support business sectors with the largest and immediate needs. We have already done much, but the work to contain the virus and measures to cope with consequences continues, therefore additional financing is needed and will be required. We are determined to invest fund purposely and closely monitor that at the end it brings expected results, including the necessary support to businesses and people," says Minister of Finance, Jānis Reirs.


As the international financial institution of the Nordic and Baltic countries, NIB finances projects that improve the productivity and benefit the environment of the region. The Bank also has a stabilising role during economic crisis.


"The loan from NIB will finance the required support measures to the business activities in affected sectors in the forms of loans, capital injections or payment reliefs," says Henrik Normann, President & CEO of NIB.


Earlier, NIB has signed similar loans with the Republic of Estonia and the Republic of Lithuania. The Bank has also issued its inaugural EUR 1 bn NIB Response Bond, as well as SEK 4 bn NIB Response Bond, and will use the proceeds to finance projects that alleviate the social and economic consequences of the COVID-19 pandemic on NIB's member countries.


NIB is an international financial institution owned by eight member countries: Denmark, Estonia, Finland, Iceland, Latvia, Lithuania, Norway and Sweden. The Bank finances private and public projects in and outside the member countries. NIB has the highest possible credit rating, AAA/Aaa, with the leading rating agencies Standard & Poor's and Moody's.

 






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