Government to assist small, medium and large companies in dire straits
Government set to assist “nationally-important” companies
MANILA – As different companies reel from the impact brought about by the COVID-109 pandemic, a senior government official said they are looking into the plight of thes outfits.
This Finance Asst. Secretary Antonio Joselito G. Lambino, Jr.’s response to a question at the press briefing at the Presidential Palace hosted by Presidential Spokesperson Harry Roque of the plight of airline companies whose operations have been severely affected by the lockdown and travel restrictions.
“One (option) is to give capability to our government financial institutions to form a holding company that would engage in equity investments with nationally-important companies experiencing solvency issues. This is because solvency issues cannot be addressed by merely lending to them,” he said. He added there are instances when equity investments are needed “but this is time-bound and subject to specific conditions.”
Asst. Secretary Lambino who also acts as Department of Finance Spokesperson added among the conditions are against using investments to pay for bonuses or salary increase “it’s about looking across industries, finding the ones nationally important and seeing what kind of support is required or needed.”
Mr. Lambino said in some instances, loan programs are possible, and they know that every peso the government invests in a loan facility, “banks are able to multiply that eight and a half times.” Now speaking of guarantee programs, PhilGuarantee has approved additional programs as for every peso placed in guarantees, “that is multiplied by around twenty times in the economy” but it all depends on the company’s condition. He said a company may have temporary or long-lasting solvency issues.
“And we will look if they need equity investments as assistance instead for the problems they are experiencing or if loan programs will help,” he added. He assured everyone there are programs for small and medium enterprises as well as for big companies.
He said the other details will be discussed during deliberations in Congress next month.
In a separate interview over Wednesday Roundtable @ Lido, Air Carriers Association of the Philippines’ (ACAP) executive director Roberto Co Lim said while they are not seeking subsidies from the government, it would be best for the government to issue guarantees to private banks for them to remain liquid. He said the carriers’ hopes include the return to the normal flight frequency but these days, Lim said the domestic airlines are anywhere from 5-7% of the regular daily flights.
“We are also seeking the government’s assistance by waiving the parking, take-off and landing fees which amount to some P500 million a month,” Lim said. Should the airline industry fail to meet the necessary assistance, Lim said airline companies may have to return their aircraft and operate on a limited scale. (Melo M. Acuña)
DOF Asst. Secretary and Spokesperson Antonio Joselito G. Lambino II (left) and ACAP Executive Director Roberto Co Lim. (Screen grab from PCOO and Wednesday Roundtable @ Lido/Melo M. Acuna)