Free Newsletters - Space - Defense - Environment - Energy
..
. Medical and Hospital News .




POLITICAL ECONOMY
Spain's bankruptcy epidemic slays giants, dwarfs
by Staff Writers
Madrid (AFP) Dec 04, 2013


Washing machines, fish fingers and football teams: not even household names are safe from a Spanish bankruptcy epidemic ravaging big and small businesses alike.

The number of companies filing for bankruptcy in Spain rose from 1,147 in 2007, the year before Spain's real estate bubble disastrously burst, to nearly 6,200 in 2009, according to the National Statistics Institute.

It topped 9,000 in 2012 and "I think that in 2013 we are going to get close to 10,000," said Carlos Sancho, a lawyer and expert in financial management at IESE Business School.

One big name after another has succumbed in recent months.

Real estate developer Reyal Urbis went under in February, sunk by 3.6 billion euros ($4.9 billion) of debt.

The giant frozen fish maker Pescanova, which employs 10,000 people, followed in April. In November it was the turn of Fagor, one of Europe's biggest maker of household appliances such as washing machines.

The bankruptcy reaper has also come knocking on the door of more glamorous businesses, such as Deportivo A Coruna league football club and the organiser of the Miss Spain beauty contest.

About a third of recent bankruptcies have affected real estate firms -- the sector whose collapse in 2008 triggered Spain's financial crisis and double recession, driving unemployment up to nearly 26 percent currently.

Brokerage Axesor is forecasting an increase of about 25 percent in bankruptcies in 2013 and a slight easing in 2014, said Javier Ramos, its research director.

The companies formally filing for bankruptcy reflect only a part of the toll from the crisis, however.

"In Spain the rate of bankruptcies is still very low," accounting for just a quarter of all business shutdowns in January to September this year, Ramos said.

Spanish industry is largely composed of small companies, which "are very afraid of filing for bankruptcy", said Celia Ferrero, vice-chairwoman of the small business federation ATA.

"What the small businessman normally does is close down the business directly," settling its affairs without applying for court supervision in a formal bankruptcy procedure, she said.

Although a bankruptcy procedure, in which a judge regulates negotiations with debtors, offers hope that a company may be saved, in practice fewer than one in 10 firms that make the filing in Spain avoid being liquidated.

"We all rather have the feeling that if a company files for bankruptcy protection, it is clearly not going to be able to carry on," said Sancho.

He said bankruptcy laws should be reformed to "hold out an umbrella to the businessman so he can weather the storm".

Spain's official economic figures show that it technically emerged from recession in the third quarter of this year, with timid growth of 0.1 percent.

But "we are now seeing the judicial consequences of the crisis," said Sancho.

After the crisis erupted in 2008, many companies took out more loans to try and keep them afloat, which are now due for repayment.

Spanish banks -- who themselves had to tap 41 billion euros ($56 billion) from a eurozone rescue fund last year -- are less willing than before to extend new ones.

"I think that if we could hold on a little longer, if credit started to flow again, then a lot of the companies that are on the verge of shutting down could survive until the economy gets a bit better," said Ferrero.

Some of the public authorities contracting services delay their monthly payments for up to five months, worsening the difficulties of small businesses, she said.

"One in four small businesses has had to close precisely because of this defaulting by public administrations," Ferrero said.

"Nearly half a million small businesses have disappeared during the crisis."

Enrique Bujidos, a restructuring specialist with consultancy PricewaterhouseCoopers, forecast: "2013 is going to be the year with the most bankruptcy filings in Spain's history, without any doubt."

.


Related Links
The Economy






Comment on this article via your Facebook, Yahoo, AOL, Hotmail login.

Share this article via these popular social media networks
del.icio.usdel.icio.us DiggDigg RedditReddit GoogleGoogle




Memory Foam Mattress Review
Newsletters :: SpaceDaily :: SpaceWar :: TerraDaily :: Energy Daily
XML Feeds :: Space News :: Earth News :: War News :: Solar Energy News





POLITICAL ECONOMY
US aims lucky 'Year of the Horse' greenbacks at Chinese
Washington (AFP) Dec 03, 2013
The US Treasury is selling red "hong bao" envelopes with "lucky" dollars bearing auspicious serial numbers to mark the Chinese Year of the Horse next year. Exactly 88,888 of the dollar notes go on sale Wednesday, each stuck in a red envelope blazoned with New Year's greetings and horse pictures. The serial number on each note begins with 8888, which pronounced in Chinese sounds like the ... read more


POLITICAL ECONOMY
UN to seek more aid for Philippines typhoon displaced

Typhoons spread Fukushima fallout, study warns

85 people injured in Hong Kong high-speed ferry accident

Philippines says Super Typhoon Haiyan, other storms curb growth

POLITICAL ECONOMY
'Smart' wig navigates by GPS, monitors brainwaves

CIA, Pentagon trying to hinder construction of GLONASS stations in US

GPS 3 Prototype Communicates With GPS Constellation

Russia to enforce GLONASS Over GPS

POLITICAL ECONOMY
Skull find shows women were sacrificed in ancient China

Study suggests inbreeding shaped course of early human evolution

Investments in Aging Biology Research will Pay Longevity Dividend

Research team discovers 'immune gene' in Neanderthals

POLITICAL ECONOMY
Africa risks losing 20 pct of elephants in 10 years

African elephant survival tops agenda at Botswana talks

India plans new sanctuary to boost tiger numbers

Smaller islands host shorter food chains

POLITICAL ECONOMY
Hong Kong confirms first human case of H7N9 bird flu: report

Iran warns of soaring AIDS cases

Is S.Africa's HIV treatment success breeding complacency?

Suu Kyi urges 'freedom from fear' on World AIDS Day

POLITICAL ECONOMY
Western masterpieces offered up to Chinese buyers

Communist China restores Chiang Kai-shek's house, and image

China puts another senior official under investigation

Exiled activist repatriated after failed China return bid

POLITICAL ECONOMY
Spain jails six Somalis for piracy

Pirates kidnap two American sailors off Nigeria

Seaman Guard owner to fight arrest of ship's crew in India

Somali pirates on trial for seizing French yacht

POLITICAL ECONOMY
Spain's bankruptcy epidemic slays giants, dwarfs

US aims lucky 'Year of the Horse' greenbacks at Chinese

Israeli hi-tech surfing wave of buyer interest

China home price rises speed up in November: survey




The content herein, unless otherwise known to be public domain, are Copyright 1995-2014 - Space Media Network. AFP, UPI and IANS news wire stories are copyright Agence France-Presse, United Press International and Indo-Asia News Service. ESA Portal Reports are copyright European Space Agency. All NASA sourced material is public domain. Additional copyrights may apply in whole or part to other bona fide parties. Advertising does not imply endorsement,agreement or approval of any opinions, statements or information provided by Space Media Network on any Web page published or hosted by Space Media Network. Privacy Statement