Billions of losses .. Expectations of bankruptcy of half of the small and medium-sized companies in Europe

An economic survey published today, Thursday, expects about half of small and medium-sized companies in Europe to bankrupt during the next year if revenues do not increase, which highlights the size of the economic damage caused by the emerging corona virus pandemic.

According to the survey conducted by the consulting firm "McKinsey & Co." last August and included more than 2,200 small and medium companies in the 5 largest economies in Europe, one out of every 5 companies in Italy and France will go bankrupt within the next six months.

The Bloomberg Agency pointed out that small and medium-sized companies are essential to European economies, contributing about two-thirds of the number of jobs, in addition to representing more than half of the value added to the economy in the European region.

The Corona pandemic has caused great harm to European companies, as the revenues of about 70% of those companies decreased, and the decline increased in Italy and Spain, which were the most affected by the pandemic and were forced to impose stricter closure measures to limit the spread of the virus.

The overwhelming majority of companies described the state of the economy as weak, and this raises concerns about an increase in loan defaults and resorting to layoffs of more workers, and the governments in all countries surveyed announced additional programs to support jobs, in an attempt to curb the high unemployment rate with increasing The numbers of people infected with Coronavirus.

For its part, the IAG group, which owns British Airways and Iberia, the Spanish aviation company, announced today, Thursday, a loss of 1.3 billion euros (1.52 billion dollars) in the third quarter of the current fiscal year. Due to the repercussions of the Covid-19 pandemic, the IAG Group achieved in the same period last year a profit of 1.4 billion euros, according to its statement.

Revenue decreased by 83% to 1.2 billion euros in the reporting period, and IAG said it expects no more than 30% of its passengers in the fourth quarter of this year compared to the previous year, and the group has made clear that as a result, it does not expect to achieve balance in terms of cash flows. Of operational activities during the last three months of this year.

She added that reservations did not recover as expected due to the additional measures taken by many European governments in response to the second wave of Covid-19 infections.