- September 26, 2021
- Posted by: Stratford Team
- Category: Business
Over the past few years, Evergrande’s sales have significantly declined. The global pandemic has hindered property development. China’s government has also placed tighter borrowing restrictions on real estate developers. Combined, this has created a massive cash crunch for Evergrande. To raise funds, Evergrande has tried selling off some of its assets but with little success.
Evergrande’s financial woes have weighed heavily on global stock markets. On Monday, Wall Street was hoping to recover from a three-consecutive-week decline in the Dow Jones Industrial Average (DJIA). But Monday’s optimism was short-lived. China’s government announced it would not step in to guarantee Evergrande’s outstanding debt. The news sent global stocks reeling, including a 614-point sell-off in the DJIA.
In the event of Evergrande’s collapse, the brunt of the fallout would lie in China. Banks, lenders, investors, home buyers and suppliers, among many, would be…