Payment Problems - A reality
In November 1992 the EC Commission issued a working paper on payment problems in Europe which emphasised the following:
The current trend towards more frequent payment delays is giving rise to serious worries in many Member States of the Community.
Payment problems are the largest single source of legal disputes between businesses in different Member States - 32% of cases.
The paper also emphasised that part of the reason for the deterioration in payment practice was as a result of recession in the main markets.The view was also expressed that even with a pick up in economic activity the payment practice would most likely not improve as companies have got accustomed to leaning on their supplies to finance their operations. Also business failures increase significantly as economies come out of recession and this has been evidenced recently in Ireland where company liquidations in the last quarter increased by 25%. This has been the largest number of liquidations recorded over the last 14 consecutive quarters.
This material has been provided courtesy
of Obrico Ltd Global Trade & Finance.
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