The 122nd largest company in the world and one of the largest developers in China is experiencing serious financial problems. Corporate debt is $300 billion, equivalent to 2% of China’s GDP.
The company’s problems are of great concern to market observers and economists, since the collapse of the housing giant will mean a huge economic collapse and a crisis in the real estate industry not only in China itself, but also in Asia as a whole. They warn about this, among others, the financial agencies Goldman Sachs and JP Morgan.
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Evergrande Group specializes in building affordable housing for the Chinese middle class. The developer offered customers competitive rates and deep discounts, mainly to get the company into trouble.
Information about the poor financial condition of the developer worried co-workers and customers. The subcontractors protested in front of the Evergrande headquarters, as the company had not paid the wages owed.
Investors are also not satisfied, whose failure for the developer will mean significant money loss.
laf / grz / Reuters
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