ECONOMY

Fewer firms closing down, or opening up

fewer-firms-closing-down-or-opening-up

The first four months of the year saw fewer companies closing but also fewer new enterprises being set up, a development linked to a hesitant stance from business people ahead of political developments this year.

Figures from the General Commercial Register (GEMH) have revealed that in this January-April period 12,512 new businesses were opened, against 13,405 in the same period last year, which constitutes a decline by 6.6 percent year-on-year. At the same time 5,077 enterprises shut down, compared with 7,343 in the first four months of last year, a major reduction of 31 percent.

More than half of the companies that left the commercial register in that period – 2,886 enterprises – were one-person firms.

Notably the statistics of corporate shut-downs do not only include companies that went bankrupt or went into liquidation, but also those that merged with others or entered a forced administration. Legal sources with an expertise in bankruptcy law note that several corporations either do not apply for entering the bankruptcy mechanism anymore, or transfer their expired loans to debt management companies.