Published: July 16th, 2021,
Last updated: July 16th, 2021
China’s economic miracle is fueled by exuberant capital injections. Ever since the 1990s, this pattern is repeating: Ambitious company executives take out far too many loans in their relentless desire to expand their business. Public banks then have to painstakingly deleverage sprawling groups of companies. Now it looks like the Evergrande real estate group is next in line. The company has created many millions of square meters of residential and commercial space all over China. Now debt-servicing difficulties are emerging. Our team of writers in Beijing explains whether a ‘second HNA’ is imminent. In case you need to refresh your memory: After the company HNA went on an investment spree that lasted for several years, the Hainan-based tourism group had to declare bankruptcy in January, which resulted in its divestment.