Chinese builder in debt jam says it will make bond payment
ABC News
A Chinese real estate developer that is struggling to avoid defaulting on billions of dollars of debt says it will make an interest payment due this week
BEIJING -- A Chinese real estate developer that is struggling to avoid defaulting on billions of dollars of debt reassured jittery global markets at least briefly Wednesday by announcing it will make an interest payment due this week.
The Chinese government, meanwhile, kept investors guessing about whether it might intervene.
Evergrande Group’s struggle to comply with financial limits regulators imposed to curb rising debt levels has prompted fears a default might cause global shockwaves. Economists say banks and bondholders are likely to lose money if Evergrande restructures its $310 billion debt but Beijing has the resources to prevent a Chinese credit crunch.
The government wants to avoid appearing to arrange a bailout as it tries to force private companies to cut their debt loads but probably will try to protect families that paid for apartments that are yet to be built, economists say. That would cause bigger losses for other creditors.
