The Strategist

Analysts: number of bankruptcies decreased worldwide in 2020 thanks to state support measures for business

02/10/2021 - 10:23

According to calculations by Coface, an international group specializing in insurance and trade risk management, the number of bankruptcies in 2020 has decreased in most regions of the world despite the global crisis.

Globally, the number of bankruptcies fell by 12%, in the eurozone by 22%, in Asia-Pacific by 19% and in North America by 3%.

Such dynamics is explained by the governmental business support measures that helped many companies survive the last year in spite of all the difficulties. Coface analysts believe that without government support measures the number of bankruptcies worldwide in 2020 would have jumped by 36%.

If the measures are extended, however, the corporate sector would get additional bankruptcy protection for the current year as well. The shock the market experienced in 2020 will turn into a significant increase in bankruptcies in 2022, even if we take into account the positive impact of government support measures.