Taming the Wave of Small and Medium Enterprise Insolvencies

by Federico J. Díez, Romain Duval, Chiara Maggi and Nicola Pierri The pandemic has hit small and medium enterprises particularly hard, partly because they are predominant in some contact-intensive sectors like hotels, restaurants, and entertainment. As a result, many advanced economies risk experiencing a wave of liquidations that could destroy millions of jobs, damage the […]

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Slow-Healing Scars: The Pandemic’s Legacy

By Sonali Das and Philippe Wingender Recessions wreak havoc and the damage is often long-lived. Businesses shut down, investment spending is cut, and people out of work can lose skills and motivation as the months stretch on. But the recession brought on by the COVID-19 pandemic is no ordinary recession. Compared to previous global crises, […]

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The Great Divergence: A Fork in the Road for the Global Economy

By Kristalina Georgieva As G20 finance ministers and central bank governors meet virtually this week, the world continues to climb back from the worst recession in peacetime since the Great Depression. The IMF recently projected global GDP growth at 5.5 per cent this year and 4.2 per cent in 2022. But it is going to […]

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Structural Factors and Central Bank Credibility Limit Inflation Risks

By Gita Gopinath After ending last year with unexpectedly strong vaccine success and hope that the pandemic and economic distress it caused would recede, we woke up to the reality of new virus variants and the unpredictable, winding road that it can lead the world down. Something similar has happened with the discourse on inflation. […]

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Government Support Is Vital as Countries Race to Vaccinate

By Vitor Gaspar, Raphael Lam, Paolo Mauro, and Mehdi Raissi The COVID-19 pandemic is accelerating in many countries and uncertainty is unusually high. Decisive government actions are necessary to ensure swift and extensive vaccine rollouts, protect the most vulnerable households and otherwise viable firms, and foster a durable and inclusive recovery. Most countries will need […]

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A Race Between Vaccines and the Virus as Recoveries Diverge

By Gita Gopinath In just three months since we released our last forecast in October, recorded COVID-19 deaths have doubled to over 2 million, as new waves have lifted infections past previous peaks in many countries. In these same three months, multiple vaccines have seen unexpectedly strong success and some countries have started ambitious vaccination […]

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COVID-19 Hits the Poor Harder, but Scaled-Up Testing Can Help

By Allan Dizioli, Michal Andrle, and John Bluedorn Across the world, poor neighborhoods have experienced more COVID-19 infections and deaths than wealthier ones. The pandemic and the efforts to control it have disproportionately hurt the poor, both within and across countries. Gaining a better understanding of what accounts for the disparate health impacts across income […]

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How Artificial Intelligence Could Widen the Gap Between Rich and Poor Nations

By Cristian Alonso, Siddharth Kothari, and Sidra Rehman New technologies like artificial intelligence, machine learning, robotics, big data, and networks are expected to revolutionize production processes, but they could also have a major impact on developing economies. The opportunities and potential sources of growth that, for example, the United States and China enjoyed during their […]

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Chart of the WeekHow a Collective Infrastructure Push Will Boost Global Growth

By IMFBlog With vaccines around the corner, there is increased hope that the pandemic could soon be under better control. That said, the need for cooperative efforts to work toward a better future has never been greater. Priority areas relate to the need to produce and distribute vaccines globally, tackle climate change, and bolster the […]

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Time is Ripe for Innovation in the World of Sovereign Debt Restructuring

By Peter Breuer and Charles Cohen When corporations have too much debt and need to restructure it, creditors often end up exchanging bonds or loans for stocks. They trade the guaranteed payout of a fixed-income investment for an equity position whose return depends on the company’s future results. In other words, investors accept to share […]

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