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Policy Insights

Policy Insight 103: Born Out of Necessity: A Debt Standstill for COVID-19

Patrick Bolton Lee Buchheit Pierre-Olivier Gourinchas Mitu Gulati Chang-Tai Hsieh Ugo Panizza Beatrice Weder di Mauro

21 Apr 2020

Many low and middle income countries may face problems servicing their external debts while addressing the COVID-19 emergency. Urgent action is needed to prevent disorderly defaults and litigations. This Policy Insight describes a mechanism to implement a debt standstill which would free significant resources to cover some of the most immediate costs of the COVID-19 crisis.

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Bolton, P, L Buchheit, P Gourinchas, M Gulati, C Hsieh, U Panizza and B Weder di Mauro (2020), Policy Insight 103: Born Out of Necessity: A Debt Standstill for COVID-19, CEPR Policy Insight No 103, CEPR Press, Paris & London. https://cepr.org/publications/policy-insight-103-born-out-necessity-debt-standstill-covid-19