The COVID-19 pandemic is a human health emergency with profound and wide-ranging economic impacts. Like many economic crises before it, the current recession has caused a marked decline in business activity, interruptions to global value chains, increased unemployment, credit squeezes, and rising government debt levels. It has also caused a liquidity shortfall for both businesses and individuals, weakening their ability to meet debt payment obligations and pushing many into a state of insolvency.
In light of the bleak financial reality faced by countless firms during the pandemic, questions arise as to whether these businesses can withstand the storm. A recent note by the World Bank Group explores the pandemic’s early impact…