Spain seals deal to reactivate economy

The Spanish government on Friday signed an agreement with business leaders and union representatives that aims to reactivate the economy and create jobs in the wake of the coronavirus crisis.

The signing ceremony took place at Prime Minister Pedro Sanchez’s official residence in the Palacio de la Moncloa after a cabinet meeting, which saw the approval of a range of economic measures to finance the digital transition and also to support the country’s tourism sector, which has seen its revenues reduced by over 60 percent in the first five months of 2020 due to the pandemic.

“These agreements are a message of confidence to our European partners and the rest of the world,” said Sanchez, who also appealed for political and social unity.

“When Spain can agree, Spain gains in hope and its future. We are going to develop an adequate framework for remote working and a deal for industry,” he said.

The measures approved by the cabinet on Friday are meant to “support the reactivation of the economy and employment … and accelerate the recovery,” according to an official government communique.

The measures include 40 billion euros (45 billion U.S. dollars) in loans to help companies achieve digital transformation and become more ecologically sustainable. The government will focus on companies that are considered strategic due to their “social and economic impact, their relevance for security, the health of citizens, infrastructures, communications or their contribution to the proper working of the markets.”

There will also be a 12-month moratorium on mortgage payments for tourist properties for companies affected by the crisis. The government will provide further funds to the digitalization of the sector and will also direct over 50 million euros to developing 260 different sites for rural tourism over the next two years.

Finally, the cabinet approved “Plan Renove 2020,” which aims to stimulate the automobile industry with 250 million euros in subsidies for people looking to buy a new vehicle. The incentives range from 300 euros to 4,000 euros per vehicle, with greater incentives for people looking to buy hybrid or electric vehicles.

Just under 400,000 new cars were sold in Spain in the first six months of the year, 51 percent fewer than in the same period in 2019, the Spanish Association of Automobile and Truck Manufacturers (ANFAC) confirmed earlier this week. (1 euro = 1.12 U.S. dollars)