"Does Evergrande’s Collapse Threaten China’s Economy?" - by CWP alum Zongyuan Zoe Liu

Evergrande Group was established as a private real estate developer in 1996 at a time when China was urbanizing rapidly and the government was dismantling its system of state-provided housing by privatizing urban housing. Its core business has been property development, but it has also diversified into other industries such as electric vehicles, finance, health care, and tourism. Evergrande made its debut as a Fortune Global 500 company in 2016, just two decades after its establishment, and managed to stay on the list until 2022. It was ranked the world’s most valuable real estate brand in 2018, but was downgraded to “restricted default” by the U.S. credit rating agency Fitch in December 2021 after missing two dollar-denominated bond interest payments. In August 2023, Evergrande filed for Chapter 15 bankruptcy protection in the U.S. bankruptcy court in the Southern District of New York, a necessary step in its attempt to restructure its foreign-held debt.

By Zongyuan Zoe Liu, CFR Expert - February 13, 2024 5:39 pm (EST) - https://www.cfr.org/in-brief/does-evergrandes-collapse-threaten-chinas-economy

Zongyuan Zoe Liu is Maurice R. Greenberg fellow for China studies at the Council on Foreign Relations (CFR). Her work focuses on international political economy, global financial markets, sovereign wealth funds, supply chains of critical minerals, development finance, emerging markets, energy and climate change policy, and East Asia-Middle East relations. Dr. Liu’s regional expertise is in East Asia, specifically China and Japan, and the Middle East, specifically Gulf Cooperation Council countries. Dr. Liu is the author of Can BRICS De-dollarize the Global Financial System? (Cambridge University Press) and Sovereign Funds: How the Communist Party of China Finances its Global Ambitions (Harvard University Press).

Photo Credit: By Dinkun Chen - Own work, CC BY-SA 4.0, https://commons.wikimedia.org/w/index.php?curid=119850994