Chilean metallurgical companies call for faster COVID-19 aid response

Some 80% of the 250 member companies of Chile’s metallurgical industry association Asimet are awaiting government aid to keep their businesses going. 

Last month, the government announced US$5b in loan guarantees to help companies fight the COVID-19 effect. Loans will be provided by banks, but with a guarantee from the state. 

“To date, 80.6% of our members haven’t received the financing. COVID-19 loans aren’t being awarded with the urgency that is needed,” said Asimet president Dante Arrigoni in a webinar. “The banking sector response isn’t what the country requires.” 

Last Sunday (May 17), President Sebastián Piñera called on banks to speed up issuing loans. 

According to Arrigoni, 19.4% of Asimet members had been granted loans under the scheme as of mid-May. Of the 48 companies, around 15 received the amount asked, while the average granted was the equivalent of one month’s sales. 

According to the latest report of securities regulator CMF to the senate, up until May 10 banks received 97,281 loan requests from all sectors and 34,195 had been approved, rejected or reviewed. 

Asimet forecast that COVID-19 will affect 35% of its members with lower sales during 2Q20 and a 50% workforce reduction at more than 120 companies. 

The metallurgical sector could see a contraction of 5% this year, the trade group says.

Photo credit: Chile's mining ministry