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The recovery in global activity has been led by countries in the Asia-Pacific region, with 6.9% growth, and Latin America with 5.7% growth, while Western European and US GDP, at 1.7% and 2.9% respectively, have lagged behind, according to international credit insurance and collections company Atradius. The overall EU figure also masks a wide disparity in the GDP development of member states, ranging from a 3.6% rise in Germany, the UK and France to a dip of 4% in Greece.

Improving real economic activity led to a widespread decrease in insolvencies during 2010, although the speed and timing varied from country to country. The level of insolvency rates remained structurally high, however, as did the general price of credit risk.

The pace of the economic recovery is expected to slow in 2011 compared to 2010, but the likely scenario - that of a protracted recovery - implies that there will be further improvements in the insolvency environment in 2011. Despite these projected improvements, a prolonged period of relatively weak corporate credit conditions is expected.

While the opinion is that the downward phase of the cycle is now behind us, there is still uncertainty surrounding the sustainability of the recent pick-up. Emerging fiscal constraints coupled with sluggish credit conditions translate into a high degree of forecast uncertainty for 2011.

Large and growing imbalances within the Eurozone became the major theme of 2010, and the fallout from recent sovereign debt pressures in Greece and Ireland underscores the risk of rapid contagion.

Consequently, GDP growth rates in 2011 are expected to be slower than 2010 and below their historical averages.

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