The rescue of embattled Chinese property company Evergrande appears to have stalled, leaving the developer on the brink of default and threatening to unleash contagion through the country’s giant real estate sector, home prices and the economy.
The problems enveloping Evergrande, which has eyewatering total debts of $305bn, have hung over global financial markets in recent weeks and helped curb China’s post-pandemic recovery.
Indeed, it’ll be interesting to see if the Chinese government is able to deflate this balloon slowly and demonstrate that no private company is too big to fail. The West could learn an important lesson from that.
Yeah, I think that would send a strong message and does appear to be a case of controlled demolition.