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South West companies run by leaders from ethnic minority groups are being hit “particularly hard” by the coronavirus outbreak, new research has found.

The virus and social-distancing rules have exacerbated pre-existing socio-economic inequality in the region, according to the report by the Black South West Network (BSWN).

Cashflow and liquidity are the biggest problem for black and Asian business owners and the self-employed, the report said, with 90 per cent of those questioned by BSWN experiencing financial loss.

Some 83 per cent of voluntary and community organisations stated they were currently unable to deliver services, while 92 per cent expect community needs to increase due to Covid-19.

The report also found entrepreneurs and the self-employed from ethnic minority backgrounds were overrepresented in sectors hardest hit by the pandemic.

Sado Jirde, director at BSWN said: “Covid-19’s impact on loss of income is commonplace but it has hit family-run black, Asian and minority ethnic businesses particularly hard, rippling out into whole supply chains.

“Hardest hit sectors have more BAME staff, and whilst furloughing has helped big business, small business owners and self-employed BAME people are struggling to apply narrow national support criteria.

“As we emerge from the crisis, we must ensure that our economic response reaches everyone equally and equitably.”