In countries like ours, where the conditions of the financial cycle in the years preceding the outbreak of the pandemic were not such as to justify the build-up of capital buffers, there was less room for manoeuvre.
Very narrow risk premiums in both debt and equity markets and lofty expectations about returns on the part of investors and borrowers greatly reduced the cost of external funds. A frenzy of capital-raising followed, led by telecommunication and Internet firms.