Business News Asia
The Evergrande debt crisis continues to unsettle Asian investors as the future of the heavily indebted real estate developer remains uncertain.
Concerns grew when China’s second-largest real estate developer failed to pay interest payments due from overseas bondholders.
Evergrande now has 30 days to make the due payments before the bond has defaulted. Investors in Asia are still trying to figure out the implications of an Evergrande meltdown.
The Chinese government, however, offers little hope for Evergrande’s rescue. According to information, the government in Beijing will ensure that the remaining capital will be used for open construction projects.
Meanwhile, authorities are currently auditing Evergrande’s wealth management division.
The PBOC (People’s Bank of China) has already signaled that only home buyers will be protected.
In addition, China is now also affected by power outages.
Power outages at many locations led to production stoppages. Experts expect that this will hit the industry hard and could further depress the Asian markets. The power outages can now be observed globally, from Europe to Asia.
The signs consolidate on an end of Evergrande. China’s government and central bank have already confirmed their stance in their announcements. It remains to be seen when the sentiment will spill over into the markets.
As a result, investors in Asia are increasingly looking for safety again and are buying physical gold. The gold price is meanwhile still at just under $1750.