Obama announces new aid to small business

15:21, October 22, 2009      

Email | Print | Subscribe | Comments | Forum 

U.S. President Barack Obama announced Wednesday new lending initiatives to boost credit supply for America's small businesses which are still facing credit squeeze in spite of the economic recovery.

A White House statement said that since the financial crisis began, U.S. small businesses have faced a perfect storm: the pulling back of lending by banks, deterioration in the value of real estate that they often rely on for collateral and weakened sales.

It is a big test for the Obama Administration to help small businesses access capital, create jobs and support a durable economic recovery.

The administration has already taken several important steps to get credit flowing again to small businesses and to encourage job growth. But they are considered remaining in the woods.

America's 29 million small businesses "have been some of the hardest hit by this recession," Obama said during his visit to a small business in Maryland.

"America will not recover until our small businesses recover," said Treasury Secretary Tim Geithner.

"In communities across the country, they are the engines of job growth and lead the way to the industries of the future. While we have made progress stabilizing the financial system, we need to do more to help small businesses get the credit they need to grow and hire," Geithner added.

Under the new initiative, the administration will take steps to improve access to credit for small businesses by supporting lending by small banks and Community Development Financial Institutions (CDFIs) through the Financial Stability Plan.

The government will also seek legislation to increase the maximum size of Small Business Administration loans.

Analysts said that the focus of the new plan is on jobs. With unemployment currently forecast to be above 9 percent at the end of 2010 -- when the administration's congressional allies face mid-term elections -- officials are desperate to bring forward the turnaround in the labor market.

Source: Xinhua
  • Do you have something to say?
Special Coverage
  • 60th anniversary of founding of PRC
Major headlines
Editor's Pick
Most Popular
Hot Forum Dicussion