After the various previous deadlines, China Evergrande Group is again on the edge of a default, with downbeat comments from the property developers. Evergrande will face the end of a 30-day grace period on Monday again, with dues this time at $82.5 million, having made three 11th-hour coupon payments in the past two months. This has added to a situation of liquidity crisis in China’s once-booming property market.
“Failure by Evergrande to make $82.5 million in interest payments due last month would trigger cross-default on its roughly $19 billion of international bonds and put the developer at risk of becoming China’s biggest defaulter – a possibility looming over the world’s second-largest economy for months”, according to Reuters.
Once China’s top property developer, Evergrande had more than 1,300 real estate projects. But now it has turned up as a focal point of property crisis in China with over $300 billion of liabilities. According to the govt, this problem of Evergrande can be resolved only if the firm plans to restructure its overseas debt with the help of global investors.