Japan Records 10,144 Bankruptcies in FY2024, Highest Since 2013

Japan saw a significant rise in bankruptcy filings in fiscal 2024, totaling 10,144 cases, the highest in 11 years, reflecting a 12% year-on-year increase according to Tokyo Shoko Research. Most sectors experienced this uptick, except for financial and transportation industries, highlighting widespread economic challenges. Interestingly, while bankruptcy cases rose, the total debt involved decreased to 2.37 trillion yen ($16.08 billion), attributed mainly to more small- and mid-sized firms failing. The largest bankruptcy was that of Mitsubishi Aircraft Corp., which had liabilities of 641 billion yen after ending its SpaceJet project. The Bank of Japan is closely monitoring these trends as they assess interest rate policies, with Governor Kazuo Ueda indicating that future hikes depend on sustained wage growth supporting consumer spending. This surge in bankruptcies raises concerns about the broader economic landscape in Japan, potentially impacting employment and investment.