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Evergrande claims to have resumed work on more than ten projects

Beijing, Oct 24 (EFE) .- The Chinese real estate giant Evergrande assured this Sunday that it has resumed work on more than 10 projects, shortly after the local press pointed out that the company paid the interest on a fair offshore bond one day before officially defaulting.

The group reported today through the Wechat social network that some projects in cities such as southern Shenzhen have entered “the interior decoration phase to be delivered” and that the group is finishing construction of other buildings.

Evergrande, a paradigm of the opening policy of the Asian country since the 1970s, has a total liability of more than 300,000 million dollars, of which 37,000 correspond to loans to be repaid before the end of the first half of 2022.

The Chinese real estate sector began to overheat in the late 1990s, when regulators at the time reached out to developers eager to take advantage of the Chinese brick boom.

Restrictions on capital outflows and the volatility of local stock markets have made property one of the preferred investment vehicles in China, in part because there is still no national property tax: according to Moody’s Analytics, homes represent nearly 60% of Chinese household equity and more than 75% of their debts.

On the sidelines, the authorities have tried in recent years to regulate the sector to control its excessive expansion, forcing companies to reduce liabilities and offer ever greater discounts to maintain liquidity.

Some experts estimate that the direct and indirect weight of the real estate and construction sectors reaches between 20 and 30% of the national GDP.

It is also believed that between 13% and 22% of the country’s urban homes are empty, especially in smaller cities, in some of which authorities have already begun to set limits on how much flats can drop in price for “maintain stability” of the market.

(c) EFE Agency

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