Central Bank of Iran Updates List of Corona-Hit Businesses

EghtesadOnline: The Central Bank of Iran has updated and communicated the list of businesses directly hurt by the coronavirus outbreak to banks across the country, which are eligible to receive loans.

News ID: ۷۴۹۹۹۸

09 May 2020

The list published on CBI website includes the following businesses and jobs:

1. Businesses, institutions and companies offering meals, including restaurants, buffets, reception halls, coffee houses and cafes. Their eligibility for receiving government aid is determined by the Ministry of Industries, Mining and Trade.

2. Businesses active in the tourism and hospitality sectors, namely hotels, apartment hotels, tourists centers, centers receiving pilgrims, guesthouses, eco-lodges, recreational centers and museums. The onus is on the Ministry of Cultural Heritage, Handicrafts and Tourism to determine whether these businesses would qualify to receive government aid.

3. Transportation companies, namely air, road, rail and marine transportation firms. The Ministry of Roads and Urban Development is responsible for determining whether these businesses would be eligible to receive government aid.

4. Intra-city public transport companies. The Interior Ministry will be responsible to specify whether they qualify to receive government loans.

5. Travel agencies. The onus is on the Ministry of Cultural Heritage, Handicrafts and Tourism to determine whether these businesses qualify for aid.

6. Apparel manufacturers and distributors. The Ministry of Industries, Mining and Trade will determine the eligibility of these businesses.

7. Manufacturers and distributors of footwear and bags. The Ministry of Industries, Mining and Trade will determine the eligibility of these businesses.

8. Confectioneries and shops selling nuts, dried fruits, ice-cream and fresh juice. The Ministry of Industries, Mining and Trade will determine their eligibility.

9. Gyms, sports and leisure centers. The onus is on the Ministry of Sports and Youth to determine whether these businesses qualify to receive government aid.

10. Cultural, educational and art centers as well as media groups. The onus is on the Ministry of Culture and Islamic Guidance, Education Ministry and the Ministry of Science, Research and Technology to determine whether these businesses qualify for the government’s financial support.

11. Handicraft producers and distributors. The onus is on the Ministry of Cultural Heritage, Handicrafts and Tourism to determine whether these businesses would be eligible to receive government aid.

12. Health Ministry’s licensed private-run health and treatment centers, including laboratories and those providing para-clinical services.

13. Driving schools, barber shops and beauty salons. The Ministry of Industries, Mining and Trade will determine the eligibility of these businesses.

14. The Ministry of Culture and Islamic Guidance will also determine whether any bookstores or publisher would be qualified to receive government loans.

$4.6b Aid Package

The Iranian government has approved a 750 trillion-rial ($4.6 billion) package to help low-income households and struggling businesses impacted by the coronavirus. The loans will be given to small- and medium-sized enterprises hit hard by the pandemic, according to the website of the Central Bank of Iran.

The lending rate will be 12% to be repaid within two years, Abdolnasser Hemmati, the CBI governor, said.

Commenting on the interest rate, Hemmati said it is reasonable, given the high inflation rate in the country.

“Even if banks set an 18% interest on loans, the real interest rate would still be negative when compared to annual inflation. Any rate below 12% would apparently impose further financial strain on banks,” he said.

Hemmati said only businesses that did not lay off workers during the corona crisis would be eligible for the loans. He instructed banks to process the loans soon and cut red tape.

$1b From NDFI

Leader of the Islamic Revolution Ayatollah Seyyed Ali Khamenei has also approved the withdrawal of $1 billion from the National Development Fund of Iran—the country’s sovereign wealth fund—to help fight the coronavirus epidemic.

“The needs of the Ministry of Health and Medical Education to confront the coronavirus crisis will be met through NDFI’s resources and preferably from domestic products and knowledge-based companies,” President Hassan Rouahni wrote in a letter to the head of Plan and Budget Organization, Mohammad Baqer Nobakht.

On May 5, Nobakht tweeted that the CBI has paid the rial-equivalent of the first batch of NDFI rescue money to the treasury.

“I have invited Health Minister Saeed Namaki to attend a meeting at PBO headquarters on Wednesday to determine the resource allocation on the basis of priorities,” he was quoted as saying by IRNA.

Noting that 42,000 billion rials ($260 million) have been allocated to 15 plans, including the supply of medicines, lab kits and protective equipment for hospital staff, Nobakht said, “A total of 15,000 billion rials [$92.5 million] will be allocated to hospitals only treating coronavirus patients and 3,000 billion rials [$18.5 million] in bonuses will be granted to healthcare workers.”

Over 780,000 File for Unemployment

So far, the government has paid 50,000 billion rials ($308 million) to Unemployment Insurance Fund to support those who have lost their jobs amid the outbreak of coronavirus and an additional 10,000 billion rials ($61.7 million) will be allocated to this fund next week,” the Persian-language daily Shargh quoted Nobakht as saying.

The Ministry of Cooperatives, Labor and Social Welfare will start online registration of distressed businesses and workshops at Kara.mcls.gov.ir as of next week.

According to Cooperatives Minister Mohammad Shariatmadari, over 780,000 people have filed for unemployment since March 13, of whom 650,000 were found eligible for unemployment benefits.

Before the crisis, about 240,000 were already receiving dole payments.

“Early estimates show that a total of 70,000 billion rials [$432 million] are needed to support the newly unemployed people for three months, of which President Hassan Rouhani has approved the allocation of 50,000 billion rials [$3,8 million],” the minister said.

To prevent the spread of the virus, applicants of unemployment benefits are urged to fill out online forms for unemployment benefits at the newly-designed website Bimebikari.mcls.gov.ir within 30 days, rather than visiting the ministry’s bureaus.