Insolvency specialist Nick Hood reckons recovery will be a rough ride in 2010, wherever you are.

The talk this past year or so has been of the Global Recession. But in reality what we have suffered is a large number of quite different recessions in individual jurisdictions, all happening simultaneously and all prompted by the credit crisis – driven in turn by a decade or more of wildly excessive leverage.

While these recessions started more or less at the same time, they are ending well out of synch; recovery phases are playing out at widely varying speeds. The result is going to be a rather strange 2010, with one huge elephant in a number of different national rooms. Exactly what will happen when these economic patients begin to be weaned off the massive fiscal stimulus or quantitative easing packages currently acting as a life support for many of them?

Couple this uncertainty with the risk of debt default, and it is easy to embrace the latest gag going round the City: that sovereign risk is the new sub-prime. The prospects for a variety of European nations, previously thought safe within the Eurozone, are increasingly grim. Ireland remains shell-shocked, Spain’s property and unemployment crisis threatens its social stability and only a fundamental change in Greek attitudes to paying taxes will head off significant problems there.

Looking eastwards, the situation in the Baltic states and the Balkans, as well as the more developed former-Soviet satellites such as Hungary and Romania, is so dire that a return to anything like the previous prosperity could be many years ahead, if it is achievable at all.  

The United Kingdom probably qualifies as too important to fail, in the long run. But the scale of government debt to be forced down the throats of domestic and international investors, plus the strong possibility of a change of government, makes the short and medium term exceptionally murky.

South America has generally weathered the recession well, particularly Brazil.  The exception is poor Argentina, which lags far behind its regional partners on almost every significant economic indicator. There are genuine concerns about the chance of another instalment in its long and inglorious series of sovereign defaults.

But whatever shape the global turnaround turns out to be, and whatever speed at which it progresses, the sad truth is that corporate defaults will go on rising even after the technical ending of this recession. History shows that the recovery phase is by far the most dangerous part of any major financial correction, for the simple reason that as businesses begin to grow again they struggle to find the extra working capital they need. And banks around the world are still quite rightly repairing their ravaged balance sheets, so liquidity will be scarcer than in any previous recovery.

Governments the world over will also be cost cutting hard to correct unsustainable deficits, further threatening sectors dependent on public spending.

So nobody should be surprised when insolvency statistics soar this year to record highs, both in the UK and in other developed countries. No matter what the GDP figures may say, it could well be that 2009 will eventually be judged to have been the lull before the storm.

Farewell to 2009, the year the global financial system didn’t quite fail.

Travelling the world in 2009 was a curious experience. Initial denial of the depth of the financial crisis was gradually replaced by relentless over-optimism, driven by desperate politicians, guilt-ridden economists and a media bored with bad news. It was a year when the world’s financiers and investors failed to wake up and smell the coffee, never quite grasping the gravity of the situation.

Trips to the USA were instructive. Atlanta in high summer was a place of decimated shopping malls, but curiously the local Nieman Marcus luxury store was thriving. The mood in Chicago in late spring was flat, with even high-end popular restaurants offering discounted meal deals. On a return trip in the autumn, the mood had hardly improved.  

New York started the year in entrepreneurial shock, thanks to the negative implications of the likely slow pace of recovery. But by November this had been subsumed by a sudden and misplaced sense of horror that the taxes of rich professionals might have to rise in order to pay for healthcare for 45m dis-enfranchised Americans, a clear case of self-serving displacement outrage.  

One top lawyer complained about communists running the White House; another memorably commented that when he looked out of his window at Manhattan real estate, all he saw was leverage.  A veteran workout expert gave a memorable verdict on the US real estate market: 'Oh,' he said, 'we’re just sitting here watching the restructuring pig go through the snake, and it’ll be quite a while yet before it’s all digested'.

Europe was equally curious. Austria in April was a rare oasis of economic calm. In the same month, Warsaw seemed buoyant, boosted by the weakness of the zloty and Germans crossing the border to spend their 'cash for clunkers' money on Polish-made cars. But the near-empty tourist bars in the Pilsner Urquell brewery told another tale.  

In May, a chilly Dubrovnik had half-empty hotels and restaurants, its souvenir shops desolate for lack of tourists. France of course met the crisis in its own utterly Gallic way, its job preservation obsession still puzzling outsiders but nevertheless working well to limit the domestic impact of the crisis.

Stockholm in October was chilly, but the economic mood defied the plunging temperature. The prevailing sense then was that the crisis had skirted the Nordic region, although some bankers there were more cautious, sensing that problems lay ahead. Judging by what has happened to Saab, they may have had a point.

In February, Malaysia was positive, confident that its Asian crisis experience and heavily regulated banking system would keep it out of trouble, while Singapore’s harbour teemed with ships riding high at anchor, their lack of cargo or ballast revealing the depths of the shipping industry crisis. Despite a sharp initial correction, with eye-watering drops in GDP, Asia has recovered well - though nobody should be fooled by the doubtful economic statistics being peddled by the Chinese authorities. All is definitely not as it seems.

For all the doom and gloom, the world didn’t end in 2009, and nor did we hurtle lemming-like over the financial cliff. But we remain far too near the edge for comfort: 2010 looks like being a potentially even more painful year, as the lagging indicators of unemployment and business failures knock the fragile confidence generated by our narrow escape from financial meltdown. Travelling on business looks set to go on being a fascinating but sobering experience for the time being. Happy New Year!Publish