http://www.engineeringnews.co.za
  SEARCH
Login
R/€ = 13.69Change: -0.05
R/$ = 12.32Change: -0.01
Au 1168.78 $/ozChange: -0.02
Pt 1083.00 $/ozChange: 1.00
 
 
Note: Search is limited to the most recent 250 articles. Set date range to access earlier articles.
Where? With... When?








Start
 
End
 
 
And must exclude these words...
Close Main Search
Close Main Login
My Profile News Alerts Newsletters Logout Close Main Profile
 
Agriculture   Automotive   Chemicals   Competition Policy   Construction   Defence   Economy   Electricity   Energy   Environment   ICT   Metals   Mining   Science and Technology   Services   Trade   Transport & Logistics   Water  
What's On Press Office Tenders Suppliers Directory Research Jobs Announcements Letters Contact Us
 
 
 
RSS Feed
Article   Comments   Other News   Research   Magazine  
 
 
Jun 29, 2012

Economist warns that global corporate insolvencies could rise

Back
Bankia|Euler Hermes|Health|Asia|Europe|Spain|United Kingdom|United States|Credit Insurance|Luke Doig
Health||||
bankia|euler-hermes|health|asia|europe|spain|united-kingdom|united-states|credit-insurance|luke-doig
© Reuse this

The ongoing deterioration in the economic outlook for Europe has impelled European credit insurance company Euler Hermes to revise its 2012 outlook for global corporate insolvencies from an earlier expectation of a 5% fall to a 3% rise.

Of concern, says insurer Credit Guarantee senior economist Luke Doig, is that global company closures remain at elevated levels following the 64% cumulative rise seen in 2008 and 2009, when bankrupt- cies in the US rose accumulatively by 210% from 2007 to 2009, and those in the eurozone by 90% between 2008 and 2009. Only Asia remained relatively unscathed.

“I am uneasy about the outlook for the European economy this year and potentially into 2013 as well as the resultant impact on corporate health, implying rising payment defaults and global insolvencies,” Doig notes.

Banks are currently under pressure to restore strength to their balance sheets, and growth forecasts are being trimmed across the globe as rising unemployment, poor sentiment and weak demand dampen positive forecasting, with a further pick-up in company closures next year potentially pushing the insolvency index close to record highs.

Doig adds that the challenge for South African exporters is to select specific markets and sectors to ensure a better chance of being paid.

“Moreover, shipping on open terms, given such uncertainty, is foolhardy, especially when one considers the poten- tial contagion for bank failures. Payment protection amid this volatility is para- mount,” he warns.

Meanwhile, Doig says that a systemic break-up of the eurozone cannot be excluded while Spanish banks are scrambling to recapitalise themselves as their borrowing costs soar. With the exception of the nationalisation of Spain’s fourth- largest bank, Bankia, three savings banks, namely Ibercaja, Liberbank and Caja3, are said to be considering a possible merger, which would create Spain’s seventh-biggest lender.

He adds that an additional contributor to the European economic unease is the economic downturn currently experienced in the UK, where retail bankruptcies have recently been reported to have increased by 38% in the first quarter of 2012, compared with the first quarter of 2011.

Edited by: Martin Zhuwakinyu
Creamer Media Senior Deputy Editor
© Reuse this Comment Guidelines (150 word limit)
 
 
 
 
 
 
 
 
Other Economy News
An end to wage negotiations within the local government sector could be in sight as a conciliator’s proposal, setting out a number of settlement suggestions to resolve the deadlock, was expected on Monday. The Independent Municipal and Allied Trade Union (Imatu)...
After becoming the first provincial government to adjudicate its central banking services tender selection process in public on Friday, the Gauteng provincial Government (GPG) now plans to roll-out the “transparent” tender award process across the province to...
JSE-listed black controlled and managed investment company Brimstone expects its earnings per share (EPS) and headline earnings per share (HEPS) for the six months ended June 30 to be negative, owing to the downward fair value adjustments to investments. The prior...
Article contains comments
More
 
 
Latest News
An end to wage negotiations within the local government sector could be in sight as a conciliator’s proposal, setting out a number of settlement suggestions to resolve the deadlock, was expected on Monday. The Independent Municipal and Allied Trade Union (Imatu)...
Development financier Eastern Cape Development Corporation (ECDC) executive Noludwe Ncokazi on Friday said the organisation had the “huge responsibility of ensuring business continuity”, following the resignation of ECDC subsidiary Automotive Industry Development...
South Africa’s second-largest oil refinery, Engen Refinery (Enref), is set to undergo a three-day planned maintenance outage from July 9 as part of an ongoing maintenance programme to ensure that the facility, which delivers a significant portion of South Africa’s...
More
 
 
Recent Research Reports
Real Economy Year Book 2015 (PDF Report)
There are very few beacons of hope on South Africa’s economic horizon. Economic growth is weak, unemployment is rising, electricity supply is insufficient to meet demand and/or spur growth, with poor prospects for many of the commodities mined and exported. However,...
Real Economy Insight: Automotive 2015 (PDF Report)
Creamer Media’s Real Economy Year Book comprises separate reports under the banner Real Economy Insight and investigates key developments in the automotive, construction, electricity, road and rail, steel, water, gold, iron-ore and platinum sectors.
Real Economy Insight: Water 2015 (PDF Report)
Creamer Media’s Real Economy Year Book has been divided into individual reports under the banner Real Economy Insight and investigates key developments in the automotive, construction, electricity, road and rail, steel, water, coal, gold, iron-ore and platinum sectors.
Real Economy Insight: Construction 2015 (PDF Report)
Creamer Media’s Real Economy Year Book has been divided into individual reports under the banner Real Economy Insight and investigates key developments in the automotive, construction, electricity, road and rail, steel, water, coal, gold, iron-ore and platinum sectors.
Real Economy Insight: Electricity 2015 (PDF Report)
Creamer Media’s Real Economy Year Book has been divided into individual reports under the banner Real Economy Insight and investigates key developments in the automotive, construction, electricity, road and rail, steel, water, coal, gold, iron-ore and platinum sectors.
Real Economy Insight: Road and Rail 2015 (PDF Report)
Creamer Media’s Real Economy Year Book has been divided into individual reports under the banner Real Economy Insight and investigates key developments in the automotive, construction, electricity, road and rail, steel, water, coal, gold, iron-ore and platinum sectors.
 
 
 
 
 
This Week's Magazine
NHLANHLA NENE The main constraints to economic growth are domestic
Finance Minister Nhlanhla Nene earlier this month stated that, while South Africa’s 2015 economic growth target of 2% was achievable, it was not enough to deliver the tax revenue needed to combat the country’s challenges.
The World Steel Association has published the 2015 edition of the World Steel in Figures report, which shows an increase in steel production as well as provides an overview of steel industry activities from crude steel production to apparent steel use.
The 25-year master plan for Gauteng’s Aerotropolis project will go through a process of approval and adoption during June and July, says Aerotroplis project manager Jack van der Merwe. “We are also in the process of putting together a special purpose vehicle (SPV) to...
SOLAR PANELS The existing buildings in the Coega Industrial Development Zone lent themselves well to rooftop solar panel installations
The Coega Development Corporation (CDC) plans to fit 15 of its buildings, totalling 127 000 m2 of roof space, in the Coega Industrial Development Zone (IDZ), in the Eastern Cape, with solar panels.
The Supreme Court of Appeal’s (SCA’s) November 2014 judgment, ordering steel producer ArcelorMittal South Africa (AMSA) to hand over the 2003 Environmental Master Plan for its Vanderbijlpark steel plant to environmental pressure groups, confirmed the right of civil...
 
 
 
 
 
 
 
 
 
Alert Close
Embed Code Close
content
Research Reports Close
Research Reports are a product of the
Research Channel Africa. Reports can be bought individually or you can gain full access to all reports as part of a Research Channel Africa subscription.
Find Out More Buy Report
 
 
Close
Engineering News
Completely Re-Engineered
Experience it now. Click here
*website to launch in a few weeks
Subscribe Now for $96 Close
Subscribe Now for $96