China offers more support for virus-hit businesses

Offiicals in China said on Friday the country will further increase financial support for small and medium enterprises to reduce the impact of the new coronavirus.

China's central bank announced a 1 trillion yuan (142 billion US dollars) new re-lending fund with re-discounted interest for local banks to provide preferentially rated loans to the small and medium enterprises.

In January and February, the central bank arranged a total of 800 billion yuan (114 billion US dollar) of special re-lending funds.

China's ministry of finance said it will allow the country's local governments to further increase the bonds in 2020 to stimulate the economy, which is set to shrink with the impact of the pandemic.

Xu Hongcai, China's Vice Minister of Finance, told a press conference in Beijing on Friday that the raised capital will be invested in major infrastructural projects.

The new increase comes after the central government approved an increase 1.84 trillion yuan (264 billion US dollar) of local government bonds for this year.

China's local governments issued 4.36 trillion yuan (632.5 billion US dollar) of bonds in 2019.