The number of revoked or nullified company licenses reached 7,106 last month, surging 123.32 percent from a year earlier, amid a domestic economic downturn and global financial turmoil, Ministry of Economic Affairs (MOEA) tallies showed.
Last month’s results were the highest this year.
“Many small businesses are experiencing cash flow difficulties amid the financial crunch,” Steve Lin (林祖嘉), an economics professor at National Chengchi University, said by telephone yesterday.
Lin said he did not think the situation would improve in the short term because declining stock prices slow domestic consumption and overseas demand has also decreased, exports falling 1.6 percent last month.
Even big cities like Taipei are not immune to the slowdown, with 900 companies in Taipei closing shop last month, up from 468 companies a year earlier, the Department of Statistics said.
“The problem isn’t that consumers don’t have the money to spend, but rather their lack of confidence and unwillingness to spend,” Lin said.
The Department of Statistics said the number of companies dissolved had reached 7,064 in August, more than twice the 2,962 that closed in July and 3,342 in June, indicating that the nation’s economy had significantly worsened.
In the first nine months of this year, 37,372 companies have dissolved, up 14.29 percent from the same period a year ago. The accumulated capital was NT$458.2 billion (US$13.66 billion), up 41.56 percent year-on-year.
In comparison, the number of newly registered companies was 2,276 last month, up only 4 percent from last year’s figure of 2,186.
In addition, the number of factory closures last month skyrocketed 183.81 percent from a year earlier to 596.
The number of unemployed people last month was 464,000, of whom 145,000 lost their jobs because of factory closures, a recent report by the Directorate-General of Budget, Accounting and Statistics said.
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