Posted 1/19/2024, 6:06:00 AM
Record High of 251,000 'Zombie' Firms in Japan Unable to Pay Off Debts
- One in six Japanese companies are "zombie" firms, unable to service debt from profits alone
- The number of zombie firms hit a record high of 251,000 in March 2022, up almost a third from the previous year
- Rise of zombies partly reflects government and BOJ pandemic support like low interest loans
- These struggling firms may come under more pressure if BOJ hikes rates for the first time since 2007
- Allowing inefficient, unprofitable firms to go bust could help Japan raise growth, but may increase unemployment