Business: Japan Defaults on SA Exporters
Recent Gauteng Business News
Japanese bankruptcies (< JPY10m) amounted to 1,147 in December 2008, up 28.7% year-on-year according to Teikoku Databank (DTB), while the liabilities involved increased by 44.7%. For the year as a whole, bankruptcies totalled 12,681 (up 15.7%), with the associated debts being 117% higher than in 2007. By industry, the number of business failures in the transportation and communications industry (500 cases) surged 37.0% from the previous year. In addition, the construction industry (3,446 cases, up 17.3% year-on-year) and the wholesale industry (1,950 cases, up 18.6%) recorded huge rises. By main cause, the number of recession-induced bankruptcies came to 9,992 cases (8,445 cases in the year-ago period).
DTB’s Economic Trends Research indicates that manufacturing, construction and real estate are currently the most distressed sectors, affecting both large and small to medium enterprises. With the recession deepening, recovery remains a distant hope. Both internal and external demand is slowing, forcing a reduction in local capacity and similarly in capital investments.
This is a clear sign that the global economic slowdown has many more surprises in store for exporters around the world. 2009 could well see record post-WWII delinquencies.
According to Dadabhay, while some of the countries that have disclosed a dramatic increase in corporate failures recently include the USA, England, Ireland, Germany and even (of all places) Sweden, others might not be so keen to publicise the fact.
Business News Sector Tags: Business|