COVID-19 Bankruptcies Hit 500 in JapanEconomy
According to a Teikoku Databank survey, 500 companies have declared bankruptcy in Japan due to the impact of the COVID-19 pandemic, as of September 8. The number has ballooned in the fewer than 200 days since the first COVID-19-related bankruptcy, a Hokkaidō-based food manufacturer, on February 26.
The combined liabilities of the bankruptcies amounted to almost ¥254 billion (for 498 of the companies, with 2 still under investigation). Three were businesses valued at over ¥10 billion (amounting to 0.6% of the above total), while another 411 were valued at less than ¥500 million each (82.5% of the total), indicating that the pandemic has hit smaller, more vulnerable businesses harder.
By industry, the hardest hit were food and beverage (69 bankruptcies), and hotel and accommodation businesses (53)—impacted by requests to limit social activities under the state of emergency—followed by apparel firms (34).
Teikoku Databank commented that the business environment remains harsh, indicating that many companies are downsizing and relying on emergency financing. They also noted that a significant number of operators are abandoning the struggle and choosing to wind up their businesses.
(Translated from Japanese. Banner photo: © Pixta.)