Dun & Bradstreet: Slower growth expected even as bankruptcies fall

Nearly half (49 percent) of all countries reported a decrease in the number of business failures amidst continued economic uncertainties such as Brexit, trade friction between the US and China, and a slowdown of consumer spending in China.

In the EU, business failures in Germany and Italy were down by 3.9 percent and 5.8 percent, respectively, while UK failures dropped marginally by just 0.3 percent. In fact, 16,690 companies filed for insolvency in 2018 in the UK, which Dun & Bradstreet has labelled “stagnating”.

Despite the stagnation in bankruptcies for 2018, Dun & Bradstreet expects the number of business failures in the UK to increase in 2019, with retailers remaining a particular source of concern.

Although the report found that business failures dropped in almost half of reporting countries (21 out of 43), almost 42 percent of countries (18 out of 43) experienced an increase in failures, including Spain. (Four countries, including the UK, recorded a stagnation.) Last year, 35 percent of countries recorded an increase, which indicates a negative trend.

“The Global Bankruptcy report is yet another reminder of the continuing challenges many businesses face in this current uncertain climate,” said Markus Kuger, Lead Economist at Dun & Bradstreet.

In addition, growth forecasts for 2019 have been revised downwards since the start of 2019 and slower growth is expected in most regions, according to Kuger.

“We have been revising our forecasts down even in regions where we expect growth to increase (for example in Latin America, and in the Middle East & North Africa),” he said.

Download the full 2019 Global Bankruptcy Report by Dun & Bradstreet for comprehensive data and analytical insight on 43 counties.