Evergrande said in a report last month that it lost $81 billion in shareholder money in 2021 and 2022.
Chinese company Evergrande Group, once the country’s second largest real estate developer, has filed for bankruptcy in New York. The world’s most indebted companies defaulted in 2021, sparking a massive economic crisis in China. This was reported by CNN.
Evergrande filed for Chapter 15 bankruptcy protection, which allows a US bankruptcy court to intervene when an insolvency case involves a foreign country.
China’s real estate sector has long been considered an important growth engine for the world’s second largest economy, accounting for 30% of the country’s GDP. However, Evergrande’s default in 2021 sent shockwaves through China’s property markets, hurting homeowners and the country’s financial system as a whole.
The company reportedly defaulted after Beijing began cracking down on excessive borrowing by developers in an attempt to tame skyrocketing house prices. After the collapse of Evergrande, several other major developers – Kasia, Fantasia and Shimao Group – defaulted on their debts.
Recently, another Chinese real estate giant, Country Garden, warned that it “will consider taking various debt management measures,” fueling speculation that the company may be preparing to restructure debt as it struggles to raise money.
As you know, Evergrande is a large company with more than 1300 real estate projects in more than 280 cities. The company also has several non-real estate businesses, including an electric vehicle business, a healthcare business, and a theme park business.
Evergrande has been trying to pay off its loans since it officially defaulted on its debt by the end of 2021. At the end of last year, the real estate company’s debt stood at 2.437 trillion yuan ($340 billion), roughly 2% of China’s gross domestic product.
Evergrande also said in a report last month that it lost $81 billion in shareholder money in 2021 and 2022.
This year, the company announced the largest debt restructuring plan in Chinese history. He collects the support of creditors to complete the process. Evergrande said the company will focus on returning to normal operations over the next three years, but it needs additional funding of between $36.4 billion and $43.7 billion. The company also noted that its electric vehicle division is at risk of closing without new funding.
Earlier it was reported that China’s largest automaker will build its first plant in Europe.
Remember, according to media reports, Chinese companies working in the Russian Federation earned UAH 2.6 billion in Ukraine.
Source: korrespondent
I’m Liza Grey, an experienced news writer and author at the Buna Times. I specialize in writing about economic issues, with a focus on uncovering stories that have a positive impact on society. With over seven years of experience in the news industry, I am highly knowledgeable about current events and the ways in which they affect our daily lives.