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UK offers 330 billion pounds in loans to help businesses weather coronavirus

(Update 1: Adds economic measures, alters headline, lead, adds detail throughout first half of text)

London, Mar 17 (efe-epa).- The United Kingdom’s government on Tuesday unveiled a 330-billion pound ($398bn) emergency economic package to help businesses weather the storm of the coronavirus outbreak.

Speaking at a daily press conference, Chancellor of the Exchequer Rishi Sunak said the Covid-19 crisis had become the biggest economic threat in peacetime British history.

“The government will stand behind businesses small and large. I can announce today an unprecedented package of government-backed and guaranteed loans to support business to get through this.

“Today I am making available an initial 330 billion pounds of guarantees, equivalent to 15 percent of our GDP,” he said.

He said he had agreed on a new lending mechanism with the Bank of England to provide for big businesses while loan limits for small and medium businesses would be stretched to 5 million pounds.

Sunak also announced a three-month mortgage holiday for those struggling to keep up with payments due to the economic consequences of the Covid-19 outbreak and that some restaurants, pubs and retail firms will be exempt from business rates for a year.

Businesses in those sectors could also be eligible for between 10-25,000 pounds in government grants.

At least 71 people have died from the Covid-19 outbreak in the UK, where more than 1,800 cases have been detected.

Prime Minister Boris Johnson said government advice that citizens should avoid non-essential contact with others and refrain from going to pubs and restaurants would help slow the transmission of the virus.

He warned that stricter measures could be adopted in the coming days.

Unlike its continental counterparts like Spain and Italy, the UK has not ordered any official quarantine measures.

Earlier, Foreign Secretary Dominic Raab advised UK citizens against all non-essential travel globally for a period of 30 days, saying the advice came into immediate effect.

The Conservative Party minister said a special framework would be put in place to ensure the continuation of international trade transport.

He warned that those who decide to travel despite the advice could risk becoming stranded outside the UK if travel restrictions are further strengthened.

“The decision is being taken based on the domestic measures introduced here in the UK alongside changes to borders and a range of other restrictions that have now been taken by countries right around the world,” he told MPs.

The Foreign Office had previously limited its advice against non-essential travel to counties most affected by Covid-19, which included Spain, Italy and the United States, given the restrictive measures these nations adopted domestically to fight the virus.

Raab said that UK citizens who are currently abroad should not need to return immediately unless they were in a Covid-19 hotspot.

This new measure from the UK government looks set to pile the pressure on the already suffering airline industry, which has warned of major losses due to the coronavirus outbreak.

The Spanish-British International Consolidated Airlines Group has warned it will cut capacity by 75 percent in the coming weeks, while Ryanair, easyJet and Virgin have reduced commercial flights by 80 percent.

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