Nearly 31% of Belgium’s small and medium enterprises may not survive if the current far-reaching measures to combat the new coronavirus (Covid-19) continue, according to Belgian bank Belfius.
20,3% of SMEs already had a lack of liquid assets (cash) before the lockdown began, according to Belfius, meaning they were already struggling to survive. In the medium term, up to 30,8% of Belgian SMEs could go out of business due to a lack of capital or an excessive amount of debt. “Surviving the economic shock of Covid-19 will, therefore, be very difficult for these companies,” the bank said.
“We cannot underline the importance of these companies enough. According to Eurostat, they are the backbone of the European economy,” Belfius said. “In Belgium, no less than 99% of businesses subject to VAT are SMEs. They are therefore an essential part of our economy and they are now at the forefront of the economic contraction we are experiencing.”
The bank hopes that the economic crisis as a result of coronavirus will remain short and that SMEs will be able to count on the government for as much support as possible.