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Denmark offers companies $6bn in coronavirus cash hand-outs

Denmark's finance ministry has announced plans to spend up to 40bn Danish kroner ($6bn) to help companies hit by the coronavirus crisis to cover their fixed costs until cash flow resumes.

Denmark offers companies $6bn in coronavirus cash hand-outs
Nicolai Wammen arrives for the press conference on Wednesday. Photo: Niels Christian Vilmann/Ritzau Scanpix
Under the scheme, companies who have seen their revenues decline by 40 percent or more, will receive government grants to help cover between 25 to 80 percent of their fixed costs. 
 
The self-employed and firms with up to ten people who see their revenues fall more than 30 percent will also be offered government compensation worth 75 percent of their normal monthly income — up to a maximum of 23,000-a-month. 
 
The two grants will be available for three months, after which the hope is that the economy will be able to return to normal. 
 
“These are measures that have never been seen before. It is extraordinary,” Finance Minister Nicolai Wammen said as he announced the measures, according to the public broadcaster DR.  “We are not talking about loans. These are cash hand-outs.” 
 
The two measures come on top of the government's decision to defer as much as 125bn Danish kroner of companies' tax and VAT payments, and its decision to pay between 75 percent and 90 percent of the salaries of employees businesses send home during the crisis. 
 
It has also released banks' countercyclical capital buffer, freeing up 17bn kroner in potential liquidity. 
 
The latest measure has been welcomed by business, but has drawn criticism from some economists. 
 
“It's almost completely crazy that a Danish government can just spend 40bn kroner without any further investigation or much debate,” said Las Olsen, the chief economist at Danske Bank, told Denmark's Jyllands-Posten
 
“These are completely unheard of steps that the government is now taking,” Helge J. Pedersen, chief economist at Nordea, told the magazine. “This is significantly more than fiscal policy was expanded during the 2008-09 financial crisis.” 

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COVID-19

New Covid-19 wave in Sweden ‘to peak at end of September’

Sweden's Public Health Agency has warned of a new autumn wave of Covid-19 which it expects to peak at the end of September.

New Covid-19 wave in Sweden 'to peak at end of September'

According to both of the two new scenarios published by the agency on Monday, infection rates are set to rise steadily over the next month, something the agency said was due to a falling immunity in the population and greater contact between people as they return to schools and workplaces after the summer. 

“It is difficult to say how high the peak will be, but it is unlikely that it will reach the same levels as in January and February,” the agency’s unit chief Sara Byfors said in a press release. “The most important thing is that people in risk groups and those who are 65 years old and above get vaccinated with a booster dose in the autumn to reduce the risk of serious illness and death.” 

Under Scenario 0, the amount of contact between people stays at current levels, leading to a peak in reported Covid-19 cases at around 5,000 a day. In Scenario 1, contact between people increases by about 10 percent from the middle of August, leading to a higher peak of about 7,000 reported cases a day. 

The agency said that employers should be prepared for many staff to be off sick simultaneously at points over the next month, but said in its release that it did not judge the situation to be sufficiently serious to require either it or the government to impose additional infection control measures. 

It was important, however, it said, that those managing health and elderly care continued to test those with symptoms and to track the chain of infections, that people go and get the booster doses when they are supposed to have under the vaccination programme, and that those who have symptoms of Covid-19 stay home. 

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