Bankruptcies set to grow as economy slows, cabinet discusses legal changes

The number of bankruptcies is set to increase, but this is a normal element of market forces, claims a report prepared by debt-collection company Intercredit. In 2001, 1,180 companies declared bankruptcy. However, when compared with some of the larger European countries, the ratio of bankrupt companies to companies as a whole was modest in Poland, reads the report. According to analysts, the number of bankruptcies will grow, and although this is just a stage in the economy's development, it is also a barometer of the wider economic climate. "Market conditions are getting tougher, which mostly affects small and medium-sized enterprises, which on the one hand are the powerhouse of the economy but on the other are more sensitive to market conditions," says Katarzyna Kompowska, chairperson at Intercredit Warszawa. Some analysts believe it is not only bankruptcies that matter, but also their character and the way they are conducted, which depends greatly on bankruptcy laws. A draft amendment to the law, still eagerly discussed by receivers, lawyers and judges, is currently being studied by the cabinet. (Puls Biznesu, p. 12) M.T.