Corporate bankruptcies in Japan exceed 5,000 for 1st time in 12 years in H1

By Mucahithan Avcioglu

ISTANBUL (AA) - Corporate bankruptcies in Japan surpassed 5,000 in the first half of 2025, marking the highest figure in 12 years, a report by the Teikoku Databank revealed Tuesday.

The bankruptcies of corporate firms with a debt of at least 10 million yen ($68,100) amounted to 5,003 in the first half of the year, up 116% compared to the same period of 2024.

The service sector hadthe highest number of bankruptcies, with 1,329 companies, while the retail sector saw 1,078 bankruptcies and construction posted 986.

"Small-scale bankruptcies stood out, with those with debts of less than 50 million yen ($340,500) making up 63.2% of the total, the highest proportion since 2000," it said in a statement.

The increase in the number of corporate bankruptcies was driven by the contraction in the domestic labor force, rising raw material prices, and increases in interest rates.

The expiration of special tax cuts for companies due to the COVID-19 pandemic had a negative effect on businesses.

The total financial liability left by bankrupt firms decreased by 0.5% compared to the previous year to 677 billion yen ($4.61 billion).

The statement noted that the number of bankruptcies is expected to gradually increase this year due to the US tariffs, geopolitical tensions, and political instability in Japan.