Chinese real estate giant Evergrande continues to haunt global markets over its ability to resolve a debt crisis it faces involving a value of more than $ 300 billion.
Most recently on Friday, Evergrande shares were down 12% after recording a 17% jump on Thursday following news that the crisis is likely to be resolved.
Chinese authorities have reportedly issued a reminder to the county government to always be prepared in the face of anticipation of Evergrande’s failure in handling the crisis.
The Wall Street Journal says the directed action will give the impression of taking preparedness steps in the various possibilities that lie ahead and are expected to get worse.
The move indirectly reveals that the Chinese government is refusing to help and rescue the real estate giant, which is plunged into a multi -billion dollar debt crisis.
In the meantime, Evergrande is expected to implement other bond interest payments in the coming weeks.
Based on the agreement signed with the investors, Evergrande only has a period of 30 days before the agreement will be revoked.
Expert analysts have issued warnings that the failure of real estate developers could have a major impact on China’s economy and potentially haunt the global financial system.
The real estate industry is a key component of China's economy which accounts for 30% of gross domestic product which will also affect slower growth.
As of 11.52am, Chinese shares of Evergrande were unchanged at RM2.36.
