Why The Collapse Of Evergrande Threatens The Chinese Economy?

In the past, there are many companies that grow growing and messing so much that governments fear their collapse will lead to a comprehensive economic crisis. This story is taking place in China, with the main character 'big man' real estate industry Evergrande.0: 00/6: 36 NameVergrande domains have long been famous as a real estate development company Most of the world and have been in the "Thoi Thuc" period for many months. A series of bad news constantly coming to the company based in Shenzhen in recent weeks has accelerated what many experts warns are inevitable: collapse. Fitch ranking last week said The scene of Evergrande default "may happen"

. While Moody's said Evergrande was out of money and the time.Evergrande was facing debt of more than 300 billion USD, hundreds of unfinished residential buildings and short-term contractors have closed constructions construct. The company even began payment of overdue bills by handing over unfinished works
Observers are watching whether the Chinese government has implemented the "Clean" commitment commitment. The country's business area by leaving the "debt bombs" as Evergrande collapsed or not. Where should it be? In the glorious days a decade ago, outside the field of real estate, Evergrande also produced water Bottled, owning China's strongest football team and even has a short time to participate in pig breeding. This company also owns a electric automobile factory, although it has been delayed production Series. Currently, the name Evergrande is considered to be a threat to China's largest banks. The company was established in 1996 has promoted the real estate boom of China, contributing to China Go to the country's urbanization and lead to nearly 3/4 assets of households in China on housing. The development of Evergrande is associated with a muddy period Explode real estate in China. Photo: NY Timess This growing development has helped Evergrande hold the power center role in a real estate-based economy to grow super speed. Evergrande founder, is Members of the Chinese People's Political Congression Conference, a group of powerful essence with good relations with Beijing officials. His relationship promise may have helped creditors trust to continue For Evergrande to borrow money when this company grows and expands to new business areas
Finally, Evergrande had to bear many debts more than that could be paid. In recent years, Evergrande owes contractors and creditors for hundreds of billions of dollars, making many works "freeze" permanently. This leads to the company has faced lawsuits from home buyers but have not been handed over to the ground. Many experts said that Evergrande did not fall into this situation if not hit The most important thing, Chinese management agencies are wanting to "remove" the desperate borrowing habits of real estate developers. This has forced Evergrande to give up some of its business areas. But not any property easily pushed away. The company has not sold its tram business, although negotiations take place. Some experts believe that the buyer is waiting for Evergrande to accept the sale of newly purchased. Monday, China's real estate market is slowing down and the need to own new apartments and less. This week, the National Institute of Finance and Development, a famous consulting organization in Beijing, claiming the real estate market explosion "has reached a turning point", for the reason for weak and evil demand Whether sales slow down. Great cash that Evergrande can be obtained from the apartments of apartments. According to the study of the REDD Intelligence analysis platform, Evergrande has nearly 800 unfinished projects across China and about 1.2 million people are still waiting to move to their new home.Evergrande has reduced new apartments But even that does not attract more customers. In August, the company's home sales fell more than 1/4 compared to a year ago. "Rescue buoys" from Beijing analysts are watching whether the Beijing government continues to watch Evergrande collapse , or will give a "rescue buoy" to rescue this company. Evergrande's collapse can cause serious damage, increasing the discontent of the victims of the company, including people People, contractors and investors in the country, with a quantity of millions of people. Experts indicate that in the past, the Chinese government ever gored to save other large businesses when they met the crisis. Last year, there were many investors who poured money into companies like Evergrande because they believe that the Chinese government eventually will always enter the rescue if the system is threatened. A building is built by Evergrande Jiangsu Province. Photo: NY Times in decades, faith n

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