The worsening economic situation is taking a heavy toll on Swiss businesses. Last year the number of bankruptcies shot up to its highest level in four years.

The Swiss business information agency, Creditreform, said a total of 8,802 bankruptcies were registered in 2002, up eight per cent on the previous year.

Corporate bankruptcies were up 11 per cent, the first rise since 1997, while private bankruptcies were six per cent higher than in 2001.

Creditreform blamed the "worse than anticipated" economy and the slump in stock markets and said cautious economic forecasts and the threat of a war in Iraq meant no improvement was likely in 2003.

The agency said that over the past decade 41,178 businesses had gone into receivership - or one in every nine companies.

Fewer new firms

Last year also saw a two per cent drop in the number of new companies registered, Creditreform said.

But the number of new companies being set up - 30,964 last year - is far higher than the 8,802 forced to closed their doors.

It singled out Zurich as one of the areas with the highest level of bankruptcies. In 2002, the number of Zurich-based companies going into receivership increased by 21.5 per cent.

Creditreform said that as a centre of technology Zurich had suffered particularly badly from the decline in the Internet sector.

Bankruptcies increased by a massive 32 per cent in Italian-speaking canton Ticino in 2002, the agency said, but had previously stood at a very low level.

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