Since the pandemic, during which insolvency rates were low due to Government measures, there has been a considerable rise in insolvencies in the UK and many other jurisdictions. High interest rates have significantly increased the cost of borrowing and many companies are saddled with mountains of debt that was taken out in better times and which are now difficult to repay. In addition, high inflation and energy costs, lower consumer confidence and volatile supply chains have all contributed to making the last few years very difficult for businesses.

The economic environment has created tough conditions for UK businesses in recent years. Heightened inflation, high-interest rates, and a lack of consumer confidence have all taken their toll on trade.

U.K. TURNAROUND AND RESTRUCTURING UPDATE APRIL 2024 OUR OUTLOOK It would be safe to say that 2024 has begun at a ferocious pace for our Turnaround and Restructuring team, reflecting the many challenges and disruptive headwinds that businesses are facing into. Following the recessionary environment witnessed in the second half of 2023, the reported modest return to growth in January has not masked the disruption that we see in the market, irrespective of industry or sub-sector. Our current engagements span from online retail to shipping, financial services, and aerospace.

In 2023, we saw an increase in both voluntary administration and receivership appointments in Australia. In the context of Australia's economic climate this was unsurprising — debtor companies were grappling with volatile markets, supply chain disruptions and uncertain economic conditions, and secured lenders were invoking either or both of these regimes as a means of protecting their investments.

Nuo Ji, Lingqi Wang, Jessica Li and Sylvia Zhang, Fangda Partners

This is an extract from the 2024 edition of GRR's The Asia-Pacific Restructuring Review. The whole publication is available here.

In summary

Swee Siang Boey and Suchitra Kumar, RPC Premier Law

This is an extract from the 2024 edition of GRR's The Asia-Pacific Restructuring Review. The whole publication is available here.

This is an Insight article, written by a selected partner as part of GRR's co-published content. Read more on Insight

In a report which was made public in May 2023, the IMF reviewed its 2023 GDP growth predictions for Portugal at 2.6%. This is just after it had predicted a growth rate of 1% in April (in itself, a leap from the projections made in October 2022 which set growth at 0.7%). According to public sources, these predictions are based on an analysis of the country's economic performance in 2022 and the first quarter of 2023.

In figures released on Friday 28 July 2023 from the Insolvency Service, the total number of registered company insolvencies in England and Wales during Q2 2023 was 6,342, the highest since Q2 2009 and up by 9% compared to Q1 2023. The construction industry was again the hardest hit (a trend going back over a decade). Whilst more construction companies went into administration during Q2 compared to Q1, significantly higher numbers went quietly into liquidation during the same period, at an average rate of around 11 per day.

Part 1 of the 2023 edition of R+I In Brief explores restructuring and insolvency developments in Australia in FY22/23.

Overview

Despite the challenges flowing from increasing global inflation and supply chain disruptions, the Australian economy has to date remained resilient and a technical recession has been avoided in 2023. However, after many years of historically low interest rates, the Reserve Bank of Australia raised interest rates rapidly from April 2022 (12 rate rises and counting) as inflation became uncontrollable.

This Part of the 2023 edition of R+I In Brief provides key industry and sector insights relating to the restructuring space over the past year. These hot topics include: