Company insolvencies in Cyprus and Europe

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Corporate and private insolvencies have always been a major issue for the economies globally. Their impact is highly affecting not only creditors and stakeholders but employees and the economies as well. In 2006 there were 157.867 insolvent firms in Europe, while in Japan and the USA were estimated to 7.905 and 18.971 respectively. In Europe, 25% of the total number of insolvencies is due to late payments. Every year billions of Euros are lost in the form of outstanding debts through insolvencies. Furthermore, about 1.5 million of work positions are lost every year. For this reason, the European Union introduced the Directive 2000/35/EC on combating late payments in commercial transactions, thus the reduction of insolvencies. In 2006 the number of insolvent firms fell by 5% compared to 2005 implying that the directive is effective.

The table below represents the volume of insolvencies per country in nominal values.

 

Country

2006

2005

1.

France

38.369

41.930

2.

Germany

31.300

36.850

3.

Italy

15.900

17.150

4.

U.K.

13.777

13.462

5.

Hungary

9.575

8.126

6.

Belgium

7.455

7.878

7.

Austria

6.854

7.136

8.

Romania

6.721

3.582

9.

Netherlands

6.052

6.780

10.

Sweden

5.264

5.865

11.

Portugal

3.400

3.300

12.

Finland

2.350

2.278

13.

Czech

1.866

1.808

14.

Denmark

1.987

2.497

15.

Slovakia

1.721

1.645

16.

Spain

849

869

17.

Latvia

654

647

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