Chinese giant that should be listed after the spectacular fall

Evergrande shares from Hong Kong will be removed on Monday after more than ten decade.

This means a gloomy milestone for the fact that it was once the largest real estate firm in China, with an estimate of the stock market more than $ 50 billion (£ 37.1 billion). It was to an impressive collapse under the weight of huge debts that led to its meteorite growth.

Experts say the bust is inevitable and final.

“Once the laid out is returned,” says Dan van, Director of the Eurosia Group Political Risk.

Currently, Evergrande is most famous for its participation in the crisis, which has been reaching the second largest economy in the world for years.

Just a few years ago, Evergrande Group became a prime example of China’s economic miracle.

Its founder and chairman Her ka Jan Rose from modest beginnings in rural China to enter the list of the richest people in Asia in 2017.

Since then, his happiness has fallen from approximately $ 45 billion in 2017 to less than a billion, and a fall with Grace is as extraordinary as his company.

In March 2024, Mr. Hui was fined $ 6.5 million and banned China’s capital market for his company overestimated profits at $ 78 billion.

The liquidators also study whether they can return cash for creditors from Mr. Huy’s personal property.

At the time of her collapse, about 1300 projects were built in Evergrande in 280 cities across China.

The common empire also included an electric car and the most successful football team in China, Guangzhou FC that was kicked out of the football league Earlier this year after not paid enough debt.

Evergrande was built for $ 300 billion (222 billion pounds) borrowed money, earning it with the unenviable title of the world’s borrowed real estate.

In 2020, Beijing brought new rules to control the amount of great developers that could borrow.

The new measures made Evergrande offer their properties at major discounts to ensure that money is coming to keep the business afloat.

Fighting to fulfill interest payments, the firm is soon default on some of its foreign debts.

After a long legal analysis, the Hong Kong Supreme Court ordered the company to be initiated in January 2024.

Evergrande shares have been threatened with deviation since they were dismissed from the bidding after the court ruling.

By this point, the crisis that covered the company has destroyed more than 99% of the stock market.

The liquidation order came after the company failed to offer a working plan to drop billions of foreign commitments.

Earlier this month, the liquidators showed that Evergrande debt is currently $ 45 billion and that only $ 255 million is still being sold. They also said they believed that the full major repairs of the business will be “inaccessible”.

“The translation is definitely symbolic now, but it is such a milestone,” says Ms Wang.

All that remains is that they pay creditors and how much they can get in the bankruptcy process, says Professor Shytong Cao from the Duke University.

The next hearing of the liquidation should take place in September.

China is facing a number of major problems, including US President Donald Trump’s tariffsHigh local government debt, Weak consumer expenses. unemployment and aging population.

But experts say the collapse of Evergrande, as well as the serious problems faced by other developers, most strongly reached the country.

“The property’s assessment was the biggest economy, and the ultimate reason for which consumption is suppressed,” says Ms Wang.

This is especially problematic because the industry accounts for about a third of the Chinese economy and has become the main source of profit for local authorities.

“I don’t think China has found a viable alternative to support its economy on a similar scale,” says Professor Tsao.

The property crisis has led to “massive layoffs” strongly conceived developers, says Jackson Chan of the BondsuerMart financial markets platform.

And many real estate staff who have retained the job have seen great pay cuts, he adds.

The crisis also has a great impact on many households as they usually create their own savings.

As housing prices have fallen by at least 30%, many Chinese families have seen that their savings are in value, says Alicia Garci-Gerrer, the chief economist of the Asia-Pacific in the French Bank Natixis.

This means that they are less likely to spend and invest, she adds.

In response, Beijing announced a number of initiatives aimed at reviving the housing market, stimulating consumer expenses and enhancing the wide economy.

They range from measures to help owners of new homes and maintain the stock market to buy electric vehicles and home goods.

Despite the hundreds of billions of dollars that Beijing had been pouring into the economy, once growing in China, about 5%decreased.

While most Western countries will be more than satisfied with this, it is slow for a country that watched over 10% a year recently in 2010.

In short, probably no.

Even if Evergrande continues to grab the headlines, several other Chinese firms still face major problems.

Earlier this month, the Hong Kong Hong Kong Southern Court was brought to elimination, which made it the largest developer, which should be forced to eliminate with Evergrande.

Meanwhile, the rival giant of the Country Garden Real Estate Garden is still trying to provide a deal with its lenders to write off more than $ 14 billion of excellent foreign debt.

After a series of delay, his next hearing of the Supreme Court in Hong Kong is due in January 2026.

“The whole real estate sector was in trouble. More Chinese companies will collapse,” says Professor Tsao.

While the Chinese government has taken a number of measures to help raise the real estate market and support the economy as a whole, it did not enter directly to educate developers directly.

Mr. Chan says that these initiatives seem to have a positive effect on the real estate market: “We think the bottom (achieved) and it should be in a slow recovery. However, we probably don’t expect the recovery to be very strong.”

The Wall -Strate Investment Giant Goldman Sachs warned that real estate prices in China would continue to fall by 2027.

Ms Wang agrees, and estimates that about two years the market in Chinese real estate is “getting into the bottom” when demand finally catching up with the supply.

But Ms Garci-Gerrero puts him in the Starker-Term: “There is no real light at the end of the tunnel.”

Beijing sent “a clear message about the intention not to help the housing sector,” adds Ms Wang.

The Chinese government was cautious to avoid those measures that could stimulate further risky behavior already borrowed.

And time During the boom, the real estate market was a key engine of China’s economic growth, the priorities of the ruling Communist Party now lie elsewhere.

President Xi Jinping is more focused on high -tech fields, such as renewable energy, electric cars and robotics.

According to Ms Wang, “China is in Hlybokaje to the new development.”