December 1, 2021

The Queens County Citizen

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China | Evergrande avoids payment defaults in terrorism

China |  Evergrande avoids payment defaults in terrorism

(Beijing) Evergrande is currently avoiding a default: an ultra-ted Chinese promoter that could shake the bankrupt country’s economy, state media reported on Friday.


Ludovic Ehret
France Media Agency

The largest real estate group in China is pulling a slate estimated at 260 billion euros (373 billion Canadian dollars). Its economic situation has been viewed with concern as its potential collapse could slow the growth of the Asian giant.

Italian world champion Fabio Cannavaro coached his two-time Asian champion Guangzhou FC Soccer Club until recently, when Evergrande looked like an indestructible company a few years ago.

But the group, based in Shenzhen, south China, is now struggling with late apartment deliveries due to bad debts, interest payments to honor and a lack of cash to complete the work.

The Evergrande deadline is September 23 for interest payments on dollar bonds. Not paid, but the company has a one-month grace period – which lasts until Saturday.

To the surprise of analysts, the newspaper reported that the developer had finally transferred US $ 83.5 million to honor this interest payment. Securities Times, Citing “roots”.

The person familiar with the transaction confirmed the payment to AFP anonymously.

Fear of Evergrande bankruptcy terrorized international markets in September. The team resumed quotations after a two-week hiatus on Thursday in Hong Kong.

The action increases

In the wake of the announcement of Securities Times, Gaining more than 4% at the end of Friday.

In addition to real estate, Evergrande has invested in tourism, digital technology, insurance, healthcare and electric cars in recent years.

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But worrying about debt swelling in the real estate sector, Chinese regulators imposed “three red lines” on major developers last year, with prudent ratios aimed at reducing borrowing.

The decision sparked financial worries for Evergrande. It is struggling to continue its operations and is trying to offload the assets for bail.

After failing to sell 50.1% of the capital of one of its subsidiaries this week, the group acknowledged that it had not made significant progress in this regard. The sale could have brought in 2.2 billion euros.

The Chinese central bank last week considered the losses caused by Evergrande’s debt on the country’s economy to be “manageable”.

But the concern is in the people.

Dozens of injured owners, whose apartments had not been delivered, as well as unpaid suppliers, demonstrated in front of the group headquarters in September.

“Awesome”

Fear of social unrest can lead officers to bail or intervene to rebuild a group. Although Beijing has not yet given a clear signal.

Evergrande “can pay this interest and pay even more. They have interest payments every two weeks or more and they are “not a huge amount,” Chen Long, a Plenum Cabinet analyst in Beijing, told AFP.

“But at some point, beyond interest, there will be a down payment, and it will be several billion dollars,” Mr Chen said, adding that Evergrande will play the “miracle” or watch while waiting for the Beijing initiative.

In March, Evergrande was due to pay US $ 2 billion in bonds.

The group’s poor health is one of the hallmarks of the real estate sector in general seizures.

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New home prices have been slashed for the first time in six years in the wake of buyer distrust that new developers are at risk of bankruptcy.

Of the 70 large and medium-sized Chinese cities, prices are trending lower in a year in September, the government said on Wednesday.

According to Bloomberg Agency figures, prices fell by an average of almost 1%.