Business bankruptcy filings within the European Union experienced a sixth consecutive quarterly increase in the second quarter of 2023, surging by 8.4% compared to the previous quarter. This surge led to the number of bankruptcies reaching its highest point since 2015, the inception of data collection for this metric. 

This information was gleaned from data released by Eurostat. However, in Cyprus, a contrasting trend emerged, with a notable decrease of 48.5% in bankruptcy filings in comparison to the preceding quarter. It is important to acknowledge that the Cyprus data reflects a pattern of fluctuations over the past six quarters.

Examining the case of Cyprus more closely, there was an upswing of 4.5% in the first quarter of 2022, followed by a remarkable surge of 175% in the second quarter of the same year. This was followed by a downward trajectory with a decrease of 33.5% in the third quarter of 2022 and a subsequent decrease of 12.7% in the fourth quarter of the same year. 

The first quarter of 2023 witnessed an impressive increase of 109.7%, while the second quarter of the same year saw a decline of 48.5%.

Turning attention to new business registrations across the EU, the second quarter of 2023 observed a minor dip of 0.6% in comparison to the previous quarter, following a noteworthy 2% surge witnessed in the initial quarter of the year. Broadly speaking, Eurostat points out that new business registrations in 2023 have consistently exceeded the quarterly figures recorded between 2015 and 2022.

Notably, the Eurostat publication lacks data pertaining to new business registrations in Cyprus. Additionally, scrutinizing bankruptcies based on economic activity within the EU, a rise was evident across all sectors during the second quarter of 2023. However, the scenario in Cyprus was more varied.

In the EU context, the most substantial upswings in bankruptcies in the second quarter, when contrasted with the preceding quarter of 2023, were witnessed in the accommodation and food services sector (+23.9%), followed by transport and storage (+15.2%), and education, health, and social activities (+10.1%).

When comparing the second quarter of 2023 to the last quarter of 2019, before the pandemic took hold, the number of bankruptcies displayed an upward trend across the majority of sectors within the economy. Notable spikes in the number of bankruptcies, in contrast to the fourth quarter of 2019, were evident in the accommodation and food services sector (+82.5%), and the transport and storage sector (+56.7%).

Conversely, the second quarter of 2023 exhibited a decline in the number of bankruptcy filings in only two economic sectors when compared to the fourth quarter of 2019: industry (-11.5%) and construction (-2.7%).

Shifting focus to Cyprus, it is essential to note that the figures are estimates provided by Eurostat, with gaps in the recorded data. Data spanning the last six quarters signifies a 50% reduction in construction-related bankruptcies, following a 33.2% surge observed in the first quarter of the year. Furthermore, a gradual downturn in bankruptcies within the financial and insurance sector is evident after a significant spike experienced in the second quarter of 2022.