March 27, 2023

Dubai Week

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Musk is also expected to sell shares in Tesla

Musk is also expected to sell shares in Tesla

Evergrande, a real estate company, is helping the Chinese government slow it down by selling parts of the company in trouble, the newspaper said.The Wall Street Journal“.

According to those familiar with the matter, the newspaper said the government plans to manage the internal collapse by selling off some of Evergrande’s assets to minimize damage to homebuyers and companies involved in the development.

However, according to those familiar with the matter, looking for foreign investors to buy Evergrande’s assets is not a priority as officials are closely monitoring the situation to keep other property developers in the Gulf for similar failures as they are concerned about China’s image.

The newspaper pointed out that as many details are still being explored, it could take years for the company to be removed, and that it would be “Evergrand”, but that it would be much smaller than it was before.

The State Council Information Office and the Ministry of Housing and Urban and Rural Development did not respond to a comment from The Wall Street Journal.

Evergrande, for his part, admitted that he sometimes worked hard to solve his problems with the participation of the Chinese government.

Over the past few months, officials from the local office of the Zhejiang Provincial Ministry of Housing and Urban and Rural Development have helped solve the problems, the giant said. Evergrande, its engineering department, did not clearly follow the government’s instructions and did not say exactly what they were.

Evergrande is struggling to repay its total debt of $ 300 billion, including nearly $ 20 billion in outstanding US dollar bonds.

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On October 23, Evergrande repaid $ 83.5 million worth of maritime securities for failing to meet its obligations during the first repayment period in September.

Last month, a credit rating agency, Standard & Poor’s, suggested that non-repayment of loans to Chinese real estate firms could rise as it did in Evergrand.

One-third of real estate developers in China will have difficulty paying off their debt over the next 12 months, according to a report for a US-based company.

The government’s plan now focuses on hundreds of Evergrande stalled projects.

The giant has already sold more than a million unfinished apartments in advance, and if these housing units are not completed, many families will face painful losses, undermining confidence in the housing market.

Local officials have asked Evergrande to transfer proceeds from unfinished homes to government-monitored escrow accounts, according to notices reviewed by the Wall Street Journal.

Local governments are giving some of that money to Evergrande’s suppliers, so those familiar with the matter say construction can continue. One said Evergrande had to submit requests to get money in government-run accounts.

In some areas, local governments have completely eliminated the Evergrande business and demanded that homebuyers pay, say those familiar with the matter. They added that local authorities were in talks with other developers about land acquisition.