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EXPLAINER: Chinese builder’s debt struggle rattles investors

KEYT

By JOE McDONALD
AP Business Writer

BEIJING (AP) — Global investors are watching nervously as one of China’s biggest real estate developers tries to avoid a default on its $310 billion mountain of debt. Evergrande Group, which is scrambling to turn assets into cash, rattled financial markets Friday when it warned it might run out of money. It said missing a payment on bonds or other debts might trigger an avalanche of demands to pay other debts immediately. Economists say ruling Communist Party can keep credit markets functioning but won’t bail out Evergrande, which the central bank accused of borrowing recklessly. They say that would be the wrong signal at a time when Beijing is trying to force companies to reduce dangerously high debt loads.

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The Associated Press

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