Coface’s 2019 Asia Corporate Payment Survey covered over 3,000 companies in nine economies (Australia, China, Hong Kong, India, Japan, Malaysia, Singapore, Thailand and Taiwan). 63% of companies surveyed stated that they experienced payment delays in 2018. The length of payment delays increased to 88 days on average in 2018, compared to 84 days in 2017. The length of payment delays was highest in China, Malaysia and Singapore; as well as the energy, construction and ICT sectors.
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While the yellow vests movement did have a strong impact on corporate insolvencies at the beginning of the year, the decline in mobilization and the resilience of economic growth had a positive impact on the health of French companies in March and April.Read More
Counterfeiting, e-commerce, Chinese consumers importance, even if it is generally relatively spared by recessions, the luxury market must adapt to a profoundly changing economy if it does not want to lose its exceptional status.Read More
The turnaround in the industrial cycle hits companies in the chemicals sector in Europe and North America
Signs of a slowing global economy continue to accumulate
2019 - the number of insolvencies will increase in two-thirds of countries (+3% in Western Europe)
The chemical industry in Europe and North America is suffering from fewer opportunities in the automotive sector
Improvements in assessments are concentrated in the Middle East, including Saudi Arabia's upgrade (B)
COFACE STRENGTHENS ITS MARKET POSITION IN THE ADRIATIC REGION BY ACQUIRING SID - PKZ, THE LEADING CREDIT INSURANCE COMPANY IN SLOVENIA
Coface announces today the acquisition of SID - PKZ, the market leader in credit insurance in Slovenia with a high market share. As Coface has acquired all SID - PKZ shares, the business will operate under the new brand name Coface PKZ. The acquisition supports Coface’s strategy of profitable growth in Central & Eastern Europe region.Read More
When Narendra Modi ran for Prime Minister in 2014, he pledged to boost the competitiveness of India’s industrial sector to promote growth. Modi will be running for president again in India’s general elections between 11 April and 19 May. The economy is in a better position than it was in 2014, but many of the structural fragilities that Modi inherited continue to afflict India today and a mixed track record in terms of economic reforms has dampened enthusiasm for Modi.Read More
• 2019 will be marked by high volatility in the global oil market
• Brent crude oil price to average USD 65 in 2019, according to Coface estimates
• In Mexico, the financial stress already faced by Pemex might not be contained
• Brazil oil policy is expected to have positive knock-on effect in the medium term
2018 proved to be a relatively challenging year for China. Growth slowed to 6.6% and is expected to decline further in 2019 (6.2%, according to Coface forecasts). As a result, 59% of the 1500 Chinese companies that participated in Coface’s survey believe the economy will not improve in 2019, the worst since 2003. The situation relating to payment delays also deteriorated. 62% of companies in China experienced payment delays in 2018, with 40% of respondents reporting that they recorded an increase in payment delays, much higher than the 29% registered in 2017.Read More
In 2018, Poland reached a peak in economic recovery with a GDP growth of 5.1%, the highest level of economic expansion since 2011.Despite this positive macroeconomic environment, payment delays appear to be standard practice on the Polish market. Nearly 99% of the Polish companies surveyed by Coface experience payment delays. Only one out of 100 companies reports receiving payments on time.Read More
• Stagflation becoming a reality, exports are a key-source of revenues for economy, especially in the automotive sector
• Exporters are flexible; government support is vital for exporters to gain new market shares
Turnover: €1,385m, up 4.6% at constant scope and FX
Net loss ratio at 45.1%, an improvement of 6.2ppts; annual net combined ratio at 79.6%
Net income (group share) of €122.3m; of which €24.1m in Q4-2018. Annualised RoATE at 7.7%
Solvency ratio estimated to have risen to ~169%, above target range (140%-160%)
Coface continues to actively manage its capital base
Two pitfalls for businesses in 2019: the economic downturn and political risks.
Coface will be sharing its vision of the major trends in the world economy in 2019 with businesses at its annual conference on country and sectoral risks.
Coface continues its innovation strategy expanding its online offer to Business Finder, an interactive online tool that helps clients to easily find new business partners. With this service, Coface enables its clients to select new target groups from the largest database in Central and Eastern Europe (CEE) with 30 million companies.Read More
French companies in 2019: Rise in insolvencies but higher margins will allow cushioning the impact of slowing global trade
• After two years of improvement, insolvencies are on the rise and this trend should continue in 2019 (forecast of +0.8%)
• This uptrend mainly affects micro-enterprises with revenues of less than EUR 500,000
• The disappointing export performance of French companies is partly due to their choice to increase their margin rate
• This applies to most key export sectors: automotive, pharmaceuticals, aeronautics and agri-food
• But this recovery in margins would be an advantage to cushion the impact of slowing global trade in 2019
When considering risk in the Chinese economy, a lot of the discussion has focused on large State-Owned Enterprises (SOEs) or large private conglomerates. However, headwinds impacting Small and Medium Enterprises (SMEs) should not be neglected. SMEs are scrambling to access financial resources to meet their working capital and long-term expansion needs, amidst a looming trade war with the United States and rapidly deteriorating financing conditions. Given their importance in the Chinese economy, it is likely that policymakers will take steps to prevent SMEs from becoming the weak link. Several measures could be helpful: prudent fiscal stimulus, a rational approach to regulating shadow banking, and a shift to more market-based interest rates so as to reward underwriting procedures that allocate adequate risk returns.Read More
Wind energy industry: production costs will increase under the influence of the trade war and the liquidity squeezeRead More
Halfway through its trade diversification process, the United Arab Emirates is yet to be integrated into international value chains
• Thanks to its strategic location, the United Arab Emirates (UAE) plays a central role in regional exports and re-exports, as demonstrated by its various economic and cooperation agreements with other countries.
• Further involvement in the Belt and Road Initiative represents both a risk and an opportunity for the UAE.
• However, the country is still only halfway through its diversification process, and is yet to be integrated in global value chains.