BRUSSELS: The EU on Thursday extended until the end of this year the easing of European state aid rules and gave governments freer rein to salvage firms struck down by the pandemic.

The extension comes as the coronavirus pandemic drags on, with the European economy not expected to enter a recovery before later in the year as a vaccine rollout stumbles.

The European Commission, the EU’s executive arm, said it will lift the state aid rules until December 31, prolonging the previous deadline by six months.

“We need to keep making sure that member states can provide businesses with the necessary support to see it through,” EU competition chief Margrethe Vestager said in a statement. In its decision, the commission further increased certain ceilings on loans and subsidies for companies and also allowed for emergency loans to be changed into subsidies.