Bankruptcies up across EU, down in Cyprus during last quarter

The number of bankruptcy declarations among EU businesses increased substantially in the fourth quarter of 2022 (+26.8 per cent compared with the previous quarter), while estimates for Cyprus show a decrease (-13.4 per cent) during the same period, according to Eurostat.

During the fourth quarter of 2022 bankruptcies in the EU reached their highest levels since the start of data collection in 2015. In Cyprus during the same period, estimates show the third lowest level of bankruptcies ever recorded, following the fourth quarter of 2021 and the first quarter of 2022.

The number of bankruptcy declarations in the EU increased during all four quarters of 2022. In Cyprus, there had been an increase during the second quarter of 2022, before bankruptcy declarations continued decreasing. Bankruptcies have been decreasing since the first quarter of 2021, when they had reached the highest levels ever recorded.

When it comes to registrations of new businesses in the EU, these decreased slightly by 0.2 per cent in the fourth quarter of 2022 compared with the previous quarter.

Generally, in all four quarters of 2022, business registrations levels were higher than during the pre-COVID pandemic period 2015-2019.

The data on bankruptcy declarations in Cyprus during the fourth quarter of 2022 are based on Eurostat estimates. Also, the data does not include updated information on business registrations in Cyprus.

Looking specifically at bankruptcies by activity, all sectors in the EU registered increases in the number of bankruptcies in the fourth quarter of 2022 compared with the previous quarter.

Transportation and storage (+72.2 per cent), accommodation and food services (+39.4 per cent), and education, health and social activities (+29.5 per cent) were the activities with the highest increases in the number of bankruptcies in the fourth quarter of 2022 compared with the previous quarter.

Compared with the pre-pandemic fourth quarter of 2019, the number of declarations of bankruptcies in the fourth quarter of 2022 was higher in the majority of sectors of the economy. The largest increases in the number of bankruptcies, compared with the fourth quarter of 2019, were recorded in accommodation and food services (+97.7 per cent) and transportation and storage (+85.7 per cent).

The number of declarations of bankruptcies in the fourth quarter of 2022 compared with the pre-pandemic fourth quarter of 2019 was lower in only three sectors of the economy: industry (-17.6 per cent), construction (-9.2 per cent) and information and communication (-4.0 per cent).