Huge rise in bankruptcy in Bulgaria

For the period January – June 2009 open bankruptcy procedures in Bulgaria are 2.5 times more than announced in January – June 2008.

These data suggest the international company for management of credit risk Kofas. With the largest share – 10.4 percent of total bankruptcies is traditionally the riskiest sector – agriculture and forestry. Increase in bankruptcy in this sector over the same period of last year has almost tripled.

Narrow and a share of 9.8 percent in the second place is the construction industry, and a third with equal shares of the bankruptcy of 6.8% are companies dealing with various commodities, industry and transport and storage.

Increasing the number of open procedures this year alone is expected to trend a crisis situation, said Kamelia Popova, manager Kofas – Bulgaria.

Even increased insolvency proceedings in our country are still small, given the ratio between the total number of companies registered and operating in the country – 1.2 million to 240 thousand, she adds. For the past six months of the year, most procedures are found in Bulgaria – their share is 43%

The second and third place are Plovdiv and Rousse by 7% and 6%. In 2008 in Bulgaria is still no real crisis, so the bankruptcy proceedings of companies fell by 30 percent over the previous 2007

Construction sector headed out the most risky in our country with a share of 11.3 percent of total bankruptcy. Second exception is traditionally the riskiest sector in recent years – agriculture and forestry with a share of 9.5 percent, followed by retail with 8.9 percent share and the production of food and drinks with 7.1% share .

Among the sectors registered open insolvency proceedings in 2008 are shown and new sectors such as companies trading in various goods, telecommunications and information technology, manufacturing of furniture and chemicals.

According to the analysis of Kofas still slow procedure of bankruptcy in our provokes more and more companies to undertake the collection of claims out time and benefit from credit insurance.

Experts are definite, especially now that companies in sectors critical to minimize the risk by insuring your business and examine its future partners in advance.

Inter-indebtedness in Bulgaria marked a 32 percent growth

for the first five months of 2009 versus the same period last year. Since the beginning of the year, analysts reported delay in payments by an average inter-60 to 90 days.

As a rule, be considered for outstanding claims are not paid within 30 days after expiry of credit period.

Negative trend in our country is below the global average, where payments between the poor have doubled in the first quarter of this year versus the same period in 2008, reported by Kofas.

Most of us are at historically high delays in sectors such as construction and agriculture, where the nature of the imposed field periods are longer – 180-240 days.

Growth in the construction of default is twofold,

a collection rate is very low due to significantly reduced liquidity of many companies in the sector. Because there is already a crisis delays in traditionally strong export-oriented sectors such as textiles and metals, the data show Kofas.

Popova stated in a message to the media, despite the negative trends Pikul economic crisis in the world is already over.

In Bulgaria, the first positive signals we can expect after mid-2010 as the crisis in our country was „introduced“ in about a year later and now feel its impact the most, says Popova.

With good macroeconomic stability and possibly more clear signals for stabilization of the economy at the end of next year, predicts expert.

For the first half of 2009 Kofas registered a sharp increase in insolvency proceedings in the country. The study prepared by the company from 2004 onwards and the development of all registered companies in Bulgaria.