Shaky Chinese Real Estate Group Evergrande Cuts Losses

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The Chinese real estate group Evergrande says it has booked higher turnover and a minor loss in the year’s first half. The company ran into financial trouble nearly two years ago and is at the centre of an ongoing crisis in China’s real estate sector.

 

Because of these problems, that country has to deal with an ailing economy.

Evergrande wrote that it suffered a loss of 33 billion yuan between January and June. The loss amounted to more than 66 billion yuan in the same period last year. Revenues rose 44 percent to 128.2 billion yuan, helped by a brief rebound in China’s real estate market.

The real estate group ran into problems at the end of 2021 due to its high debts and threatened to shock the financial markets with bankruptcy. In China, the debt problem in the real estate sector also caused social unrest. For example, homes already purchased were not built, and suppliers faced unpaid invoices.

Evergrande is now working to agree with creditors from several countries on cleaning up the finances. Earlier this month, Evergrande filed for a form of deferment of payment in New York. In his half-year results, Evergrande said that its survival depends on the success of restructuring more than 31 billion dollars in foreign debt.

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