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Poland's PM says new support for firms is at least $2.5 billion

·2-min read
Poland's Prime Minister Morawiecki speaks during a news conference about coronavirus disease (COVID-19) in Warsaw
Poland's Prime Minister Morawiecki speaks during a news conference about coronavirus disease (COVID-19) in Warsaw

WARSAW (Reuters) - Fresh Polish support to help the economy survive the second wave of the coronavirus pandemic will amount to 9-10 billion zlotys ($2.4 billion-$2.6 billion), or more if a total lockdown is introduced, the prime minister said on Friday.

Mateusz Morawiecki's promise of more support for businesses came after he introduced new restrictions on public life on Wednesday, warning that if COVID-19 cases keep growing sharply a blanket lockdown will be necessary.

"The total minimal cost will be around 9-10 billion zlotys, however we already know that if a national lockdown is required this cost will be higher by 5-10 billion zlotys," Morawiecki told a news conference, adding that the government's borrowing needs were already secured.

During the first wave of the pandemic, Poland introduced measures worth over 300 billion zlotys to help the economy, which included a mix of liquidity measures, guarantees and spending to help companies.

Deputy Finance Minister Piotr Nowak said on Twitter that Poland has financed around 12% of 2021 borrowing needs following a bond switch tender on Friday.

Morawiecki outlined 10 points to help businesses, including exemptions from social security payments, payments for furloughed workers and long-term loans for firms.

Morawiecki spoke as the Polish central bank's Monetary Policy Council (MPC) was holding a rate setting meeting which had been postponed from Wednesday.

Analysts polled by Reuters expect rates to remain at a record low of 0.1%, but some economists expect the bank to expand its use of other tools such as buying bonds.

Poland is struggling with a sharp rise in new coronavirus cases, with an overloaded healthcare system. Earlier on Friday the country reported a record 445 coronavirus-related deaths.

The prime minister also reiterated that Poland will oppose any attempts to link access to EU funds to governments' respect for the rule of law.

The European Parliament and the bloc's national governments are likely to reach a deal on the EU's 1.1 trillion long-term budget for 2021-2027 on Monday.

(Reporting by Agnieszka Barteczko and Alan Charlish; Editing by Jon Boyle and Alison Williams)