Tsunami made 341 Japanese firms bankrupt

The earthquake and tsunami that struck Japan in March has left behind a trail of debt worth nearly $8 billion due to failed businesses, according to a credit rating agency.

A total of 341 firms with a combined 6,376 employees have gone under due to the effects of the March 11 natural disaster as of Sunday, its six-month anniversary, credit research agency Teikoku Databank said yesterday.

The number of bankruptcies with debts of 10 million yen or more each represents about a 2.8 times faster pace compared with 123 failures in six months following the Great Hanshin Earthquake in 1995, it said.

An official from the agency said the disaster-related failures since March included many apparel and restaurant businesses as people became reluctant to spend money in these areas, Kyodo news agency reported.

By region, 62 business failures took place in the Tohoku region, of which 46 were reported in Iwate, Miyagi and Fukushima prefectures that have been hit hard by the disaster.

In the Kanto region including Tokyo, 128 failures were reported, of which 64 happened in Tokyo, according to the agency.

Of the failures, 28 businesses, or 8.2% of the total, were directly hit by the disaster, such as damage to plants by the tsunami, while more than 90% of them were caused by indirect effects, with 126 firms saying their order receipts declined as their clients were damaged by the disaster.

By industry, the construction industry saw 56 failures, followed by the hotel and inn industry, the machinery and metal manufacturing industry and the apparel industry.