Evergrande again avoids default at the last minute

Evergrande volta a evitar incumprimento à última hora

This is already the third time the scenario has repeated itself, and the Chinese construction giant Evergrande, which is undergoing a severe liquidity crisis, has once again got away with it and managed to pay interest on debt securities at the last minute, thus avoiding default.

Sources who closely follow the situation of the Real Estate, refer that the debt of Evergrande amounts to 260 billion euros. A figure higher than the Portuguese Gross Domestic Product (GDP).

Its financial situation is followed with concern because the potential collapse could slow the growth of the world's second largest economy. 

On Wednesday, the one-month grace period to make the payment on dollar bonds worth the equivalent of 128 million euros - but the creditors received the money, revealed Bloomberg

Once again the solution came at the last minute, but as it turns out, the road ahead is quite long. Until one of the next hurdles is the $255 million payment scheduled for December 28.

It is worth remembering that in October Evergrande avoided default several times by paying, at the last minute, interest on bonds issued in dollars. The group has also been selling assets in order to increase liquidity.

Local reports say that this week, the company raised 124 million euros from the sale of a stake in an Internet services company, HengTen Networks Group.

Determined to limit speculation in the real estate sector, regulators have restricted credit access to companies, aiming to reduce leverage levels. But several articles published in the official press this week suggest that the authorities seem to want to ease some of the pressure.

Evergrande's debt issued in dollars in international markets is estimated to be $19 billion (16.2 billion euros). For legal reasons, if Evergrande misses any of these payments this means that it defaults not only on that specific line, but automatically potentially on all debt issued abroad.

Debt that is still a fraction of the $300 billion that is the company's total debt.

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