A SEVEN-YEAR BANKRUPTCY RECORD MIGHT BE BROKEN IN JAPAN

Disappointing statistics on the financial difficulties, companies’ collapses and the high-profile bankruptcies are gaining momentum. According to the forecast of the company Teikoku Databank Ltd., a significant increase in insolvency cases is expected in Japan - about 10,000 companies might be on the brink of ruin.

If such a scenario really becomes real, the maximum bankruptcy record of the country, set in 2013, will be broken. It should be noted that only in April, the number of applications for bankruptcy protection in Japan exceeded the figure of 750. Moreover, more than a hundred applications are directly related to the coronavirus pandemic.

In Japan, as well as around the world, the hotels, restaurants, shops, airlines and tour operators are at the biggest risk.

These industries have almost completely terminated the activities, and the hopes for an early recovery in demand are not expected. The deplorable situation is aggravated by the fact that, along with the job losses, the employers and employees lose their income, which has negative effects on the general mood of the population.

In addition, the possibility of the so-called second wave of coronavirus infection, which some analysts predict by this autumn, is of particular concern. We should recall that for the moment, support measures have been doubled in Japan. However, according to the preliminary estimates, due to the encountered difficulties, the economy may shrink by more than 20% in the second quarter.