[20211021]IF11953_恒大集团与中国的债务挑战.pdf

https:/crsreports.congress.gov October 21, 2021Evergrande Group and Chinas Debt ChallengesConcerns about Chinas high debt levels intensified in September 2021, when its second-largest property developer, Evergrande Group, failed to repay its debt obligations. The government of the Peoples Republic of China (PRC or China) seeks to reduce debt and curtail market risks among firms like Evergrande, but defaults and a decline in property values could have broader effects. Chinas property market accounts for almost 30% of GDP, a higher percentage than in most countries, and thus has complicated Chinas efforts to reduce debt. Property is a main source of local government revenue and a key factor in corporate valuations and household net worth. This constrains policy options, despite Chinas leader Xi Jinpings statements that support reducing debt and inequality. Declining land revenue could affect local governments ability to repay loans and special bonds, which Nomura Holdings estimates reached almost $7 trillion (44% of Chinas GDP) in 2020. China relies on debt-financed fixed asset investment (including property) and exports for growth. Supply disruptions, energy and commodity shortages