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Wave of bankruptcies 'only beginning'

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17:39 CET+01:00
Fresh figures show that the number of bankruptcies in Sweden grew by 12 percent last year to a total of 5,500, and credit check company UC fears that the worst is yet to come.

Observers witnessed a dramatic turnabout towards the end of 2008 after a four year period in which the number of bankruptcies was steadily decreasing.

And "2009 seems set to be an even more difficult year for Swedish firms," according to UC, which said an estimated 9,000 companies currently find themselves in dire financial straits.

"In total, UC predicts that company bankruptcies will increase by a full 25 percent in 2009, which would take us above the 2004 level of 6,900 bankruptcies," said UC's marketing manager Roland Sigbladh.

In 2008, the transport and private services sectors were hardest hit by the economic downturn.

But Sigbladh said he expected the crisis to "widen" in 2009, with more large companies and more sectors likely to face difficulties.

"There will be a large scale shake-out as well as a probable domino effect when sub-contractors in the manufacturing industry are hit by major problems."

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