Spanish Government Approves €5 Billion in Guarantees for Businesses Amid Tariff Crisis
The Council of Ministers moves to support companies affected by U.S. tariffs, while also boosting funding for attracting top global scientists.
On Tuesday, the Spanish Government is set to approve a package of measures worth €5 billion in guarantees aimed at bolstering the liquidity and investment capacity of businesses facing challenges due to tariffs imposed by the United States.
This initiative follows President Pedro Sánchez's announcement of €14.1 billion in aid to address the economic fallout from these tariffs.
The guarantees, which will be available until June 2026 and may be extended beyond that date, are intended to mitigate the significant impacts that U.S. tariffs could have on Spanish commercial activity, production, and employment.
Although Spain holds a relatively minor position in the bilateral merchandise trade with the U.S., the effects are expected to vary widely across different sectors and regions, with certain companies being more vulnerable to U.S. trade dynamics.
Additionally, the Council of Ministers plans to increase funding for the 'Atrae' program, which is designed to attract world-leading researchers, raising the budget to €45 million.
This marks an increase of €15 million from the previous edition, which allocated €30 million for the recruitment of 31 scientists.
This current iteration is the most ambitious to date.
The measures being put forth have emerged from ongoing discussions with various parliamentary groups, indicating a collaborative approach to shaping the content of emergency legislation.
Government sources have stated that the proposals by the Popular Party (PP) are also under consideration for inclusion in the new measures.
The €14.1 billion aid package includes €7.4 billion earmarked for new financing, alongside €6.8 billion redirected from existing instruments.
The €5 billion guarantees reflect fresh funds, as do the €2 billion allocated for coverage by CESCE (Spanish Export Credit Insurance Company), which aims to enhance the internationalization of companies adversely impacted by the changing tariff landscape.
Moreover, the government will increase the limit for coverage provided by CESCE from €9 billion to €15 billion to further support exports, ensuring that existing limitations do not hinder the potential for growth.
Non-reimbursable operations will be financed through the resources of the Fund for the Internationalization of Companies (FIEM), focusing on supporting strategic international trade initiatives and projects affected by U.S. tariffs.
Once ratified by the Council of Ministers, the Real Decreto Ley will require approval from the Congress of Deputies within a month, with ongoing negotiations led by Economy Minister Carlos Cuerpo aimed at achieving bipartisan support for these comprehensive economic measures.
The strategies outlined within the legislation focus on promoting productive investment, facilitating liquidity, and enhancing the export activities of affected businesses.
In the context of U.S. domestic challenges, including criticisms of restrictions and limitations affecting American universities under the Trump administration—sparking protests from the scientific community—Spain's initiative to attract scientists may present an opportunity for researchers seeking to continue their work in a more supportive environment.
This initiative follows President Pedro Sánchez's announcement of €14.1 billion in aid to address the economic fallout from these tariffs.
The guarantees, which will be available until June 2026 and may be extended beyond that date, are intended to mitigate the significant impacts that U.S. tariffs could have on Spanish commercial activity, production, and employment.
Although Spain holds a relatively minor position in the bilateral merchandise trade with the U.S., the effects are expected to vary widely across different sectors and regions, with certain companies being more vulnerable to U.S. trade dynamics.
Additionally, the Council of Ministers plans to increase funding for the 'Atrae' program, which is designed to attract world-leading researchers, raising the budget to €45 million.
This marks an increase of €15 million from the previous edition, which allocated €30 million for the recruitment of 31 scientists.
This current iteration is the most ambitious to date.
The measures being put forth have emerged from ongoing discussions with various parliamentary groups, indicating a collaborative approach to shaping the content of emergency legislation.
Government sources have stated that the proposals by the Popular Party (PP) are also under consideration for inclusion in the new measures.
The €14.1 billion aid package includes €7.4 billion earmarked for new financing, alongside €6.8 billion redirected from existing instruments.
The €5 billion guarantees reflect fresh funds, as do the €2 billion allocated for coverage by CESCE (Spanish Export Credit Insurance Company), which aims to enhance the internationalization of companies adversely impacted by the changing tariff landscape.
Moreover, the government will increase the limit for coverage provided by CESCE from €9 billion to €15 billion to further support exports, ensuring that existing limitations do not hinder the potential for growth.
Non-reimbursable operations will be financed through the resources of the Fund for the Internationalization of Companies (FIEM), focusing on supporting strategic international trade initiatives and projects affected by U.S. tariffs.
Once ratified by the Council of Ministers, the Real Decreto Ley will require approval from the Congress of Deputies within a month, with ongoing negotiations led by Economy Minister Carlos Cuerpo aimed at achieving bipartisan support for these comprehensive economic measures.
The strategies outlined within the legislation focus on promoting productive investment, facilitating liquidity, and enhancing the export activities of affected businesses.
In the context of U.S. domestic challenges, including criticisms of restrictions and limitations affecting American universities under the Trump administration—sparking protests from the scientific community—Spain's initiative to attract scientists may present an opportunity for researchers seeking to continue their work in a more supportive environment.
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