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

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.
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Volume/Issue: Volume 2022 Issue 002
Publication date: February 2022
ISBN: 9781513593463
$20.00
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Topics covered in this book

This title contains information about the following subjects. Click on a subject if you would like to see other titles with the same subjects.

Finance , Corporate Governance , Corporate Debt , Solvency Support to Enterprises , Insolvency , Reorganization , Liquidation , Restructuring , COVID-19 , policy support scheme , policy option , restructuring firm , nonfinancial firm , solvency support , untargeted support , Solvency , Debt restructuring , Crisis prevention , Corporate sector , Global

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.