• Welcome to the first edition of the Global China Connection Newsletter, also known as GCC Newsletter!
• This newsletterin intended to inform and keep you updated of what’s happening in China!
• There will be a monthly edition of this newsletterso don’t miss it.
• This edition will dive into Chinas property crises and their presence at the World Economic Forum
Chinese Premier Li Qiang attended the 54th edition of the World Economic Forum in Davos Switzerland on the 28th of February. During the annual conference, Li spoke with the US delegation and was quoatedsaying: " Strengthening economic and trade cooperation is a win-win situation for both countries"
Furthermore, Li encouraged US business to continue their investment in China and said that barriers were not in the fundemental interest of bothsides
Another important thing to note is that the head of the US delegatation Suzanne Clark is leading another delegation comprising of former US government officials to visit Beijing in the coming weeks.
This visit comes as the US and China are slowly resuming official engagements after the two superpowers most tense relation in years.
This can be seen as a positive step in the right direction as tensions from the issues such as Taiwan, South China Sea and other
As the theme of this years meeting was “Build Trust”, Premier Li comes with his five ways of rebuilding trust in the Global community.
In his address to the World Economic Forum, He comes with his five ways to rebuild trust among the international community.
First way is to strengthening macroeconomic policy coordination among major economies so we can tackle crises better
Second way is to strengthen international industrial specialization and advocate for trade liberalization to keep the economy smooth
Third way is to further enhance international exchanges to better benefit humanitywith technological benefits.
Fourth way is to strengthen cooperation on green development and tackle climate change together
Fifth way is to strengthen north-south and south-south cooperation. In order to bridge development gaps and poverty alleviation we need to strengthen global development cooperation
Evergrande Group, formerly known as Hengda Group is Chinese Property gaint foundeed by Hui Ka Yan in 1996.
Evergrande has expanded rapidly throughout the years and presold unfinished apartments to chinese middle and upper-middle class Overtime Evergrande accumuluated a debt of $300 Billion.
Other than real estate Evergrande’s business portfolio includes wealth management, electric car manufacturing, food and drink production, and even ownership of a controlling stake in Guangzhou FC, one of China’s major footballteams
In 2020, Beijing introduced new rules to control the debt owed by large real estate developers. Evergrande responded by offering its properties at significant discounts to maintain cash flow
However, it is now struggling to meet interest payments on its massive debts, leading to a 99% decline in its share value over the past three years1
Last year, Evergrande filed for bankruptcy in New York to protect its US assets while negotiating with creditors on a multi-billion dollar deal1
Evergrande, a Chinese property giant, faces a critical crisis. Property buyers who invested before construction began risk losing their deposits if Evergrande collapses Additionally, business partners construction firms, design companies, and materials suppliers could suffer substantial losses, potentially leading to bankruptcy Furthermore, Evergrande’s collapse might trigger a credit crunch in China’s financial system, impacting lending and economic growth .
Picture of Guangzhou Evergrande: