Evergrande, which has $ 82.5 million expiring coupons, reported receiving reminders from creditors for debt payments of $ 260 million, fueling fears of a default that would have serious repercussions – despite assurances from the Chinese Central Bank. and various authorities – on the entire real estate sector which in the last twenty years has contributed approximately one third to the composition of the Chinese GDP. Fears of a crash have again triggered sales on the stock exchange: Evergrande shares closed trading down 19.56 percent.
Real estate, on the other hand, has other critical issues in progress: Sunshine 100 China Holdings, listed in Hong Kong, declared that it missed the deadline on Sunday to make 179 million dollars on the principal and interest payments of a bond of the 10.5%. The insolvency, the company explained in a stock exchange file, is due to “liquidity problems deriving from the negative impact of a number of factors including the macroeconomic environment and the real estate sector”. The company, according to Bloomberg’s calculations, has $ 385 million in outstanding bonds. Kaisa Group, another real estate developer in crisis, announced last week the failure of a bid on a debt swap worth at least 380 million that would have bought him crucial time to raise liquidity, warning that there was “no guarantee. »That he would have been able to meet his payment obligations.
Central bank intervention
And just looking at the difficulties of real estate, just yesterday the Chinese central bank announced the 0.50% cut in the compulsory reserve ratio for financial institutions, in a move officially intended to “support the development of the real economy and reduce the overall costs of financing “. The measure – the second in recent months – which will come into force on 15 December next will bring the average coefficient to 8.4%, said the Central Bank of China in a statement in which it reiterated its commitment to implement “a policy prudent monetary policy “, to give priority to” stability “and avoid” indiscriminate “injections of liquidity. At the same time, the promise is of “sufficient liquidity”, expressing support for the real estate sector.
Alibaba reorganizes e-commerce
Meanwhile, another Chinese giant, Alibaba, has announced the reorganization of its e-commerce operations, also appointing a new CFO amid a difficult general environment that is suffering from increased competition, an economic slowdown and a crackdown. regulation by the Beijing authorities. The Hangzhou company founded by Jack Ma clarified yesterday that the main international and Chinese e-commerce businesses will be concentrated in two new units in an attempt to achieve more agility and greater growth.