Kuwaiti SMEs Have No Choice but to Shut or Go Bankrupt Due to COVID

Published July 11th, 2021 - 01:00 GMT
Kuwaiti SMEs Have No Choice but to Shut or Go Bankrupt Due to COVID
The sources explained that studies have revealed a surge in the desire to get rid of projects due to the poor financial situation and the inability of a number of companies to fulfill their obligations towards suppliers, as well as rental owners. (Shutterstock)
Highlights
Covid takes its toll on businesses

According to reliable sources, a large section of small-sized and medium-sized companies and others are considering applying for liquidation, indicating the most violent wave that the country is yet to witness in terms of the exit of institutions from the market due to the inability to continue coping with the repercussions of the COVID-19 pandemic on businesses, reports Al- Nahar daily.

They revealed that a number of companies and owners of small and medium enterprises are studying liquidation methods to take advantage of the bankruptcy and creditor protection law, which is expected to be activated and offering many projects for sale at low prices, due to the inability to keep pace with the current situation. The sources explained that studies have revealed a surge in the desire to get rid of projects due to the poor financial situation and the inability of a number of companies to fulfill their obligations towards suppliers, as well as rental owners.

Their liquidity has been exposed to a sharp decline that does not enable them to manage their operations, and this will force the owners of companies to enter the umbrella of bankruptcy law. Many companies are now offering their assets for sale at prices less than ten percent of their value in order to pay their immediate financial obligations in terms of rents, and wages and salaries of their employees, after exhausting all avenues to obtain financing. Approximately 50 percent of small and medium enterprises will either close or go bankrupt, and these projects are now being offered for sale. The sources called on government agencies to review the conditions contained in the financing guarantee law.

 

Meanwhile, an informed source at the Directorate-General of Civil Aviation said the inbound Turkish plane to Kuwait was diverted and not allowed to land at the Kuwait International Airport (KIA) because it was not equipped with the ADS-B system, reports Al-Rai daily.

The source explained, “This system, which we are currently working on, is new, provided that maintenance is done on the radar and a return to the old system.” The source indicated that “this is not the first time that permission was denied to land, but more than 7 flights of different airlines that were not equipped with the system that we are currently working on were denied permission to land”. A circular has been issued to all airlines to work with the current system on the radar of the Kuwait International Airport. The ADS-B or Automatic Dependent Surveillance-Broadcast is a surveillance technology in which an aircraft determines its position via the satellite navigation or other sensors and periodically broadcasts it, enabling it to be tracked.


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