Business Insolvencies Drop Slightly

According to estimates released Monday by Germany's Federal Statistics Office, some 39,000 companies will register for insolvency in 2004, slightly down from last year, when 39,323 firms went under. It is the first annual decline in company insolvencies since 1999. Personal insolvencies, on the other hand, continued to rise, climbing 40 percent in 2004 to 48,000. However, analysts say that the jump could partly be due to new rules that went into effect at the end of 2001 that allowed costs to be deferred and that it does not necessarily reflect an extreme worsening of economic conditions among consumers.