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International Outlook: Global Wrapup


In a sharp break with its paternalistic past, Italys new government has ordered a major state company to go into de facto bankruptcy. Prime Minister Giuliano Amato has announced the liquidation of EFIM, a defense and heavy-industry combine burdened with $7.5 billion in debt.

But the surprise move could make borrowing much more costly for Italy in the future. The governments unilateral rescheduling of EFIM's debt has outraged foreign banks. Standard & Poors Corp., which does not rate EFIM, says it may soon downgrade the ratings of other Italian public sector companies as well as banks that borrow internationally.Edited by Stanley Reed

Toyota's Hydrogen Man
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