Protests escalate in China: Real estate firm Evergrande has sold more than a million homes, but can’t build them

Protests escalate in China: Real estate firm Evergrande has sold more than a million homes, but can’t build them
Protest at the Evergrande headquarters in Shenzhen (AFP)

The protests Against the faltering Chinese real estate giant Evergrande Extended this Wednesday to More cities in ChinaAfter the company offered parking spaces or real estate to investors requesting a refund.

Mammoth Company It admitted that it may not be able to meet its obligations exceeding $300 billion, which generates a file Fear among buyers, investors and contractors of bankruptcy will have repercussions on the second global economy.

Dozens of protesters met again Third day in a row In front of the Evergrande headquarters in Shenzhen, southeast China.

Among them were buyers of homes under construction who had already paid their money and feared that the property might not end up being handed over.

The band sangEvergrande, give us back our money’. Although they did not encounter a strong police presence, the protesters did not want to disperse, especially angry after Evergrande apparently offered to pay off their debts with promises of purported property, parking or storage units.

Evergrande customer complaints (Reuters)
Evergrande customer complaints (Reuters)

They gave us shops, nurseries, parking (…) but we can’t use them. None of us accept thatSaid a woman who only wanted to give her last name, Wang. The woman asserted that her financial company is suffering due to unpaid debts to the real estate developer.

Experts claim that the publicly traded Hong Kong company has more than a million customer-paying properties that are still unbuilt, adding to the sense that A nightmare among Chinese investors, many of whom are first-time homebuyers.

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Evergrande, one of China’s largest private companies and one of the international leaders in real estate development, admitted on Tuesday that it was under “tremendous pressure” but ruled out a bankruptcy scenario. On Wednesday, consulted by AFP, the company did not want to comment.

The real estate developer, whose rapid expansion into 280 Chinese cities has cemented its reputation, appears close to collapse, although experts say the Chinese government will not allow a chaotic bankruptcy.

“Evergrand’s bankruptcy could hurt consumer confidence if it affects deposits that households pay for unfinished homes, but we assume the government will act to protect them,” rating agency Fitch said in a note on Wednesday.

– Very rare protests –

In Jiangsu Province (east), anxious investors gathered Wednesday morning outside the company’s offices in the city of Taizhou.

Similar protests erupted in Anhui province and workers protested against their wages in the city of Igo in Hubei, also in the east of the country.

(AFP)
(AFP)

Concern is growing among service providers who have not received their payment Some in Shenzhen say they owe nearly $1 million — as well as among investors who have relied on the returns to pay off their debts and employee salaries.

On Wednesday morning, a woman was crying desperately on the floor in front of the Evergrande Building in Shenzhen. They are trying to trade their bad possessions. “It’s products they can’t sell,” one investor, who declined to be identified, told AFP.

It is very rare for the communist authorities in China to allow any kind of protests, especially in several cities at the same time.. Social media, which is usually strictly controlled by one party, was caught on Tuesday by images of the demonstrations.

(Reuters)
(Reuters)

Experts say This permissive approach may indicate the Chinese government’s desire to show the public that it is on its side as it considers the next steps to take.

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Evergrande was founded in 1996 by Xu Jiayin, who became the richest man in China during the country’s real estate boom in the 1990s.

In those years it invested in massive promotions in new cities and in 2009 raised $9000 million in its initial public offering in Hong Kong.

(With information from AFP)

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