Tourism

Brazil intervenes in the credit market, but is it too little, too late?

The Covid-19 pandemic could cause irreparable damage to the tourism and travel sector, with many companies expected to go bankrupt amid market chaos

The Covid-19 pandemic could cause irreparable damage to the tourism and travel sector, with many companies expected to go bankrupt amid market chaos
Flight cancelation rates reached 85 percent in March. Photo: Tupungato/Shutterstock

As part of a long-awaited stimulus package to fight off the economic impacts of the Covid-19 outbreak, the Brazilian Monetary Council (CMN)—the watchdog of the country’s financial system—has announced measures to make it easier for families and companies to renegotiate their debts and allow banks to keep the credit flow steady. The decision, however, comes after tourism firms and airlines warned about systemic bankruptcies in their sectors following havoc on the stock exchange.

On Monday, the Central Bank—one of the institutions represented by the CMN, alongside the Economy and Planning Ministries—waived the need for banks to increase provisions to...

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