TOKYO, April 8 (Xinhua) -- Japan saw a staggering surge in corporate bankruptcies for the fiscal year of 2023, with the number surpassing 9,000 for the first time in nine years as many businesses failed to survive without government financial aid during the COVID-19 pandemic, a local credit research report showed on Monday.

According to a survey conducted by Tokyo Shoko Research Ltd., the number of bankrupt companies in Japan with debts exceeding 10 million yen (about 65,841 U.S. dollars) jumped 31.58 percent year on year to reach 9,053 for the fiscal period from April 2023 to March 2024.

Their total debt exceeded 2.46 trillion yen, up 5.96 percent from that of fiscal 2022, the survey showed.

All 10 industry categories covered by the survey saw an increase in the number of failures, according to the research house, with the service sector logging the largest number of cases at 3,028, up 34.8 percent year on year and exceeding 3,000 for the first time in 14 years.

Meanwhile, 1,777 cases were reported in the construction sector and 1,048 cases in wholesale trade due to rising inflation and the yen's depreciation.

Attributing the spike in bankruptcies to the gradual reduction and cessation of COVID support measures, analysts here also pointed out that the country's current wage increases aimed at mitigating high inflation and labor shortages are exacerbating cost pressures, further burdening the management of small- and medium-sized enterprises.

The survey showed that the restaurant industry, which had temporarily eased its burden through subsidies for closures and shortened operating hours during the pandemic, witnessed a record-high number of bankruptcies, totaling 930 cases in fiscal 2023.

It was also projected that the number of corporate bankruptcies in fiscal 2024 may exceed 10,000. (1 U.S. dollar equals 151.89 Japanese yen) Enditem

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