Japan April-Sept. Business Failures Hit 57-Year Low

Tokyo, Oct. 8 (Jiji Press)--The number of corporate bankruptcies in Japan in April-September hit a 57-year low, thanks to the government's financing support amid the coronavirus pandemic, a private survey showed on Friday. The bankruptcy number plunged 23.8 pct from a year before to 2,937, the lowest level on a fiscal first-half basis since it stood at 1,938 in the six months of fiscal 1964, according to the survey by Tokyo Shoko Research Ltd. The number of pandemic-related bankruptcies, however, rose by around 60 pct. Total liabilities left by failed companies fell 4 pct to 574,626 million yen, hitting the lowest level since 363.1 billion yen in the first half of fiscal 1973. The survey covered business failures involving liabilities of 10 million yen or more. In the first half of fiscal 2021, all 10 industries surveyed logged drops in the number of bankruptcies, for the first time in six years. Of the total bankruptcies, those related to the COVID-19 pandemic accounted for 816, or about 30 pct, against the year-before figure of 495. Bankruptcies were noticeable especially in the construction sector, as well as the restaurant industry, which was hit by local authority requests for refraining from serving alcoholic beverages amid the central government's state of emergency over the coronavirus. The bankruptcy situation will depend on "whether companies are able to get additional loans amid ballooning debts," a Tokyo Shoko Research official said, warning of a possible increase in business failures due to lack of cash on hand. In September alone, the number of bankruptcies dropped 10.6 pct to 505, while total liabilities surged 28.4 pct to 90.86 billion yen. END