Insolvencies among UK manufacturers could increase in 2004 despite positive signs of recovery in the sector, according to the latest Economic Barometer from Atradius, a leading credit insurance and credit management provider.
Although trade between the UK and major markets in the US and Europe is slowly picking up, British businesses are feeling the after-effects of the manufacturing slump of the last few years and are still strapped for cash.
British insolvencies actually fell last year compared with 2002, although this was more a result of prior rationalisation than an improvement in the risk environment. (See UK in Depth – News – 6 February 2004.) However, Atradius warns that the performance of the manufacturing sector in 2003 could have a knock-on effect on other companies, increasing the number of business failures in 2004.
