CHINA - Media
OutReach - 1 September 2020 - Atradius
forecasts a jump in insolvencies across Asia in 2020, with Hong Kong expected
to be one of the most affected markets across the globe. The increases are
primarily driven by the impact the Covid-19 pandemic is having on global
economies. Every major economy, except for China, is expected to enter
recession this year, the depth and length of which will be determined by the
ability of economies to manage health regulations and either exit lockdowns or
thrive in social distancing.
Atradius Chief Economist John
Lorié commented, "Government measures have reduced the anticipated increase in
bankruptcy filings in a range of ways. They have either shifted the threshold
for filing, reduced debtor's ability to force bankruptcy, or provided
sufficient financial support to delay filings. However, as the support programs
begin to expire, the number of filings should climb rapidly."
Among Asian economies,
Atradius forecasts insolvencies to rise 39% in Hong Kong, behind just Turkey
and the United States in the global ranking. The city's economy is in a deep
recession and there has been little or no suspension of insolvency proceedings.
However, Hong Kong's government has implemented a sizable fiscal stimulus
programme that has helped to dampen the number of insolvencies. Elsewhere in
the region, Japan, Singapore and South Korea will experience a considerable
growth in insolvencies during 2020 but see a significant decrease in 2021.
Bart Poublon, Head of Risk
for Atradius APAC said, "The pandemic has put downward pressure on Asia's
export-driven economies as global supply chains come under pressure and demand
wanes. However, as one of the first regions to reopen, Asia is well-positioned
to benefit from the rebound in economic activity, which will lead to falling rates
of insolvency in 2021.
Get the 2020 Q3 Insolvency Report here:
Atradius is a global provider of credit insurance, surety
and collection services, with a strategic presence in over 50 countries. The
credit insurance, bond and collection products offered by Atradius protect
companies around the world against the default risks associated with selling
goods and services on credit. Atradius is a member of Grupo Catalana Occidente
(GCO.MC), one of the largest insurers in Spain and one of the largest credit
insurers in the world. You can find more information online at www.atradius.com.hk
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