June 19, 2020 / 8:04 AM / 23 days ago

Hong Kong's bankruptcy filings jump to 17-year high in May

HONG KONG (Reuters) - Bankruptcy filings in Hong Kong rose to a 17-year high, records showed on Friday, as the coronavirus pandemic dealt a heavy blow to the businesses following months of social unrest.

There were 2,079 petitions presented last month, Official Receiver’s Office said, the highest since May 2003.

The figure came as the city’s unemployment rate rose to 5.9% in the March to May period, the highest in more than 15 years.

The number of compulsory winding-up filings stood at 68 in May, the highest since July 2009.

The total number of bankruptcy filings in the first five months was 3,605, 12.4% higher than 3,207 a year earlier.

A much higher than usual figure in May could be partly due to delays in process, as the Office noted the special work arrangements of the judiciary during February to April affected the statistics during the period. Court operations were significantly reduced during those months due to coronavirus restrictions.

Hong Kong’s retail sales, one of the hardest hit industries, slumped 36% in value terms in April from a year earlier. The city’s biggest retailer association has estimated that 15,000 retail stores will close down by the end of the year if operating conditions do not improve.

Hong Kong’s economy shrank 8.9% in the first quarter compared with a year earlier, posting the third straight quarter of year-on-year contractions for territory, and its worst quarterly drop since records began in 1974.

Reporting by Clare Jim; Editing by Sam Holmes

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