Bailout (debt assumption or debt repayment)

A bailout is a debt assumption or repayment by a third party. A bailout is possible on different levels: private sector bailout (for example between banks among themselves or between the state and banks), international bailout (for example between international organizations and states, for example between the International Monetary Fund (IMF) and Argentina) or between states.

In this way, one country's debts can be paid off by other countries. Risks exist when a heavily indebted country creates more and more debts, which the other countries then have to pay off. Therefore, in the Treaty on the EU (Maastricht Treaty), a bailout ban for all associated countries was contractually stipulated.

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