Sánchez announces a €14.1 billion plan for aid against tariffs

Prime Minister Pedro Sánchez has announced a €14.1 billion trade response and relaunch plan to help businesses and workers respond to the tariffs announced by US President Donald Trump.

In an appearance at La Moncloa Palace, Sánchez announced the Trade Response and Relaunch Plan in response to the 20% tariff increase imposed by Trump on the European Union and the 25% increase in vehicle tariffs.

“The Spanish government is not going to wait and see what happens in the coming days. Starting today, we will deploy our Trade Response and Relaunch Plan, designed to mitigate the negative impacts of the trade war initiated by Trump and create a shield to protect our economy,” Sánchez stated.

With this plan, the Government will mobilize 14.1 billion euros , of which 7.4 billion will be new financing and the remaining 6.7 billion will be from existing instruments.

TWO GREAT PILLARS OF MEASURES

The measures announced by Sánchez are structured around two main pillars. “One is to help and protect businesses and jobs that could be affected by the new tariffs,” Sánchez explained, and, secondly, to fulfill the objective of ” reorienting our productive capacity and relaunching it in the new global context, always under the prism of strategic autonomy.”

For the first purpose, the Government will launch two lines of guarantees and intermediated financing from the Official Credit Institute (ICO), endowed with 6 billion euros, to facilitate access to financing and meet their working capital needs.

It will also promote the Productive Industrial Investment Support Fund , endowed with 200 million euros, to provide loans and capital participation to modernize or install new production plants.

SOCIAL DIALOGUE TABLE

In addition, the new Moves plan, endowed with 400 million euros, will be implemented, which will serve as a stimulus for the automotive sector. In response to the request made to Sánchez this Wednesday by the social sectors, the Executive will convene the Social Dialogue Table with employers and unions to monitor and address the needs of the affected groups.

To meet the second objective, reorienting production capacity, the Executive will redirect €5 billion from the Recovery Plan so that affected industries and companies can transform and reorient their production capacities toward new, high-demand sectors.

FIND NEW MARKETS

At the same time, it will help companies find new markets and expand their exports with €2 billion in credit insurance and export risk coverage, €500 million for the internationalization of SMEs, and a specific ICEX plan that will help affected sectors strengthen their position in the United States and access new markets.

To coordinate these measures and ensure their proper implementation, Sánchez announced the creation of an Interministerial Commission for Trade Response and Relaunch.

And to maximize results, he said he will ask the European Commission to adopt a series of urgent measures at the EU level, such as activating a special State aid framework, “which will provide greater flexibility for national support measures.”

He will also request the creation of an aid fund for affected sectors, financed by the collection of EU tariffs. He will also request a review of some regulations to support the sectors most affected by tariffs. And finally, he will demand an acceleration of the work necessary to achieve ratification of the agreement with Mercosur. “Furthermore, we are launching a campaign to defend our values, our products, and our services,” he added.