Evergrande avoids bankruptcy

Evergrande avoids bankruptcy
Chinese property developer, Evergrande, is the most indebted property development company in the world. The company’s debts amount to $300 billion, 19 billion of which are international bonds. On Wednesday, Evergrande made a last-minute repayment of part of its debt, more than $148 million.

The company, which is on the verge of bankruptcy, has so far failed to meet the required deadline with its payments. A lack of solvency would lead to the collapse of the large property developer and exacerbate the crisis in China.

Bankers and analysts told Reuters that Beijing will stand firm on its policy of curbing excessive borrowing by developers, even as it makes changes to financing amid a liquidity crisis in the industry.

FILE PHOTO: The China Evergrande Centre building sign is seen in Hong Kong, China. August 25, 2021. REUTERS/Tyrone Siu/File Photo

It is worth mentioning that Evergrande has until December 28 to repay $255 million. Its unfinished residential projects are also under question. As it turns out, of all Chinese developers, Evergrande is not the only one with problems. Kaisa has the largest foreign debt after Evergrande. The shares of this Chinese company and its three subsidiaries were suspended on the Hong Kong stock exchange.

According to many experts, the collapse of Evergrande could shake not only China but also the entire world economy. In addition, the FED, the US central bank warns that the problems of the Chinese developer could shake the entire global market.

12-11-2021, Mr.Advice Team

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