Canadian small businesses given lifeline against COVID-19 crisis

Ottawa, April 17 (SocialNews.XYZ) Small Canadian businesses struggling to stay afloat during the COVID-19 pandemic were given a lifeline when Prime Minister Justin Trudeau announced an expansion of emergency government assistance to include more of them.

Greater numbers of sole proprietors or entrepreneurs who run seasonal operations and who were previously shut out to qualify for a business loan will now have access to one following changes to the government's Canada Emergency Business Account, reports Xinhua news agency.

Previously, small businesses were required to have a minimum payroll of $35,000 in 2019 before they could apply for an interest-free loan of up to $28,000.

The minimum threshold has now been lowered to $14,000.

The Canadian government has also proposed to establish a program, in conjunction with the provinces, which will provide commercial property owners with forgivable loans in exchange for lowering or forgoing rent from their small-business tenants from April to June.

Eighty per cent of small businesses in Canada have either completely or partially closed during the COVID-19 crisis, and the average owner still pays $7,000 a month in rent, according to the Canadian Federation of Independent Business (CFIB), which represents 110,000 small and medium-sized enterprises across the country.

In a statement released on Thursday, the CFIB said it would make recommendations on ways to ensure small business owners see their rent costs reduced or eliminated, not just deferred.

Many firms are worried that deferring rent and other costs will simply delay a potential bankruptcy as the bills start to come due when firms are just reopening and their income remains low.

The results of a survey of nearly 11,000 CFIB members, released on Wednesday, revealed that half of them may not survive if the current COVID-19-related restrictions in Canada that have shuttered non-essential businesses and encouraged people to stay at home remain in place until the end of May.

Trudeau told reporters during his daily briefing on Thursday that "we're still many weeks away from talking about actually doing anything to reopen our economy" even as the intensity of the pandemic varies across Canada.

"It would be absolutely disastrous for us to open up too early or too quickly and have another wave hit us that could be just as bad as this one and find ourselves in a situation of having to go back into quarantine the way we are now and have everything we've done these past few weeks be for nothing," he said.

As of Thursday, there were 30,092 confirmed COVID-19 cases in Canada, and 1,193 deaths.

Source: IANS