- Antony Blinken called on the Chinese government to handle the Evergrande crisis responsibly.
- Blinken said China’s economic decisions have “profound consequences” for the whole world.
- The Chinese real estate developer is the world’s most indebted company with liabilities of over $ 300 billion.
US Secretary of State Antony Blinken called on China to act “responsibly” when dealing with the fallout from the debt crisis that threatens Evergrande’s impending collapse.
“China has to make sovereign economic decisions for itself, but we also know that what China is doing economically will have profound consequences, profound effects on literally the whole world, because all our economies are so intertwined,” Blinken said. Wednesday in an interview with Bloomberg.
Blinken added that Evergrande’s could have a “major impact” on the Chinese economy, saying the United States looks to China to “act responsibly and effectively deal with any challenges.”
This is the first time a senior official in Biden’s administration has spoken about the Evergrande crisis since the property developer missed two offshore bond payments in September. The Chinese real estate giant is currently the most indebted company in the world and owes more than $ 300 billion in liabilities. Evergrande’s non-payment of its debt caused tremors in both the Asian and international markets. It has also sparked fears of a potential contagion of real estate developers defaulting on bond payments that could spread in the Chinese market and beyond.
The Evergrande debt crisis is also affecting the US stock market. Just this week, shares in the United States and in global markets fell after the company suspended trading in its shares in Hong Kong.
However, the Chinese government has indicated that an unlikely rescue of Evergrande is likely to take place. Instead, government-owned companies and state-owned real estate developers are being pressured to buy out Evergrande and split its assets piecemeal.