Sydney, Australia, 17 Mar (efe-epa).- The New Zealand government on Tuesday announced a NZ$12.1 billion (over $7.3 billion) stimulus package to fight the impact of the COVID-19 pandemic on the country’s economy.
The package, which is equivalent to 4 percent of New Zealand’s gross domestic product, tops the government’s response to the global financial crisis in 2008 and is the most significant peace-time economic measure in the country’s modern history.
“The government is pulling out all the stops to protect the health of New Zealanders and the health of our economy,” Prime Minister Jacinda Ardern said in a statement.
The package is also comparatively larger than relief packages announced to date in Australia, the United Kingdom and the United States, according to the statement.
A large part of the package (NZ$8.7 billion) will be allocated to support businesses and jobs, including NZ$5.1 billion in wage subsidies for affected businesses available immediately.
The package also allocates NZ$2.8 billion for income support to the most vulnerable and an equal amount in business tax changes to free up cashflow.
The government will also inject an initial NZ$500 million into the health sector.
“We will be investing in more health staff, more virus testing, more medicines, facemasks, extra intensive care capacity and equipment at hospitals, and more money for (general practitioners). If we can manage the virus we can mitigate the damage to the economy,” Ardern said.
Money will also be allocated for deployment of staff and to provide assistance to those in self isolation, among others.
“I want to make it clear that this is not a one-off package, it is just the beginning. As we go through this crisis towards economic recovery the government will be constantly monitoring the situation and adjusting its response,” Finance Minister Grant Robertson said in another statement.
The stimulus package follows another NZ$12 billion package announced in January to boost the economy in New Zealand, where eight coronavirus cases have so far been recorded.
Several countries around the world have announced stimulus packages amid fears that the spread of the coronavirus could spark a recession, while their central banks have slashed interest rates, including in New Zealand, which cut interest rates by three quarters of a percentage point to 0.25 per cent on Monday. EFE-EPA