Policy Options for Supporting and Restructuring Firms Hit by the COVID-19 Crisis

Author/Editor:

Juliana Dutra Araujo ; José Garrido ; Emanuel Kopp ; Richard Varghese ; Weijia Yao

Publication Date:

February 23, 2022

Electronic Access:

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Disclaimer: The views expressed herein are those of the author(s) and do not necessarily represent the views of the IMF, its Executive Board, or IMF management.

Summary:

This paper presents principles that could guide the design of more targeted policy support and facilitate the restructuring of firms adversely impacted by the COVID-19 pandemic. To this end, the paper takes stock of vulnerabilities and risks in the enterprise sector and assesses countries’ preparedness to handle a large-scale restructuring of businesses. Crisis preparedness of insolvency systems is measured according to a newly designed indicator that includes five dimensions of the insolvency and restructuring regime (out-of-court restructuring, hybrid restructuring, reorganization, liquidation, and the institutional framework). Vulnerabilities tend to be more pronounced in jurisdictions with shortcomings in crisis preparedness, and those countries need to step up efforts to improve their insolvency systems.

Series:

Departmental Paper No 2022/002

Subject:

Notes:

Data File

Frequency:

occasional

English

Publication Date:

February 23, 2022

ISBN/ISSN:

9781513593463/2616-5333

Stock No:

POSRFEA

Pages:

78

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