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China’s Evergrande files for US bankruptcy protection

Amid the ongoing housing crisis in China, real estate conglomerate Evergrande has filed for bankruptcy protection in the US. The move is aimed at securing its assets in the United States while the company negotiates a multibillion-dollar settlement with creditors. After defaulting on its massive debts in 2021, Evergrande’s financial turmoil had widespread effects on global financial markets.

As China’s housing market woes intensify, Evergrande’s filing further exacerbates concerns about the world’s second-largest economy. The filing for Chapter 15 bankruptcy protection, filed in a New York court, safeguards the US assets of foreign companies during debt restructuring efforts. With more than 1,300 projects in more than 280 Chinese cities, Evergrande’s real estate division remains at the center of the crisis. The company’s various businesses include the manufacture of electric cars and a football club.

Amid attempts to renegotiate debt deals, Evergrande’s debts, estimated at more than $300 billion, marked it as the world’s most indebted real estate developer. It should be noted that the company’s shares have been suspended from trading since the previous year. The recent revelation of a substantial loss over the past two years further highlights Evergrande’s financial struggles. In addition, other major players in China’s real estate sector, such as Country Garden, have also issued warnings of potential losses.

The unexpected cuts to key interest rates by China’s central bank underscore the country’s efforts to revive its economy amid weak growth and declining imports and exports.

This article is sourced from and written by AI.

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