US Secretary of State Antony Blinken urged the Chinese government to ‘act responsibly’ when handling the Evergrande crisis

Secretary of State Antony Blinken urged the Chinese government to handle the potential fallout from Evergrande’s impending collapse in a responsible manner.

  • Antony Blinken urged the Chinese government to handle the Evergrande crisis responsibly.
  • Blinken said that China’s economic decisions have “profound ramifications” on the entire world.
  • The Chinese real estate developer is the world’s most indebted company, with liabilities exceeding $300 billion.
  • See more stories on Insider’s business page.

US Secretary of State Antony Blinken urged China to act “responsibly” when dealing with the fallout of the debt crisis that looms with Evergrande’s impending collapse.

“China has to make sovereign economic decisions for itself, but we also know that what China does economically is going to have profound ramifications, profound effects, on literally the entire world because all of our economies are so intertwined,” Blinken said on Wednesday in an interview with Bloomberg.

Blinken added that Evergrande’s could have a “major impact” on the Chinese economy and said that the US looks to China to “act responsibly and to deal effectively with any challenges.”

This is the first time a senior official in Biden’s administration has spoken on 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 failure to pay off its debt caused tremors in both the Asian and international markets. It has also sparked fears of a potential contagion of property developers defaulting on bond payments that could spread within the Chinese market and beyond.

The Evergrande debt crisis is affecting the US stock market too. Just this week, stocks in the US and the global markets slipped after the company suspended trading of its shares in Hong Kong.

However, the Chinese government has indicated that a direct bailout of Evergrande is unlikely to happen. Instead, government-owned firms and state-linked property developers are being nudged to buy out Evergrande and divide its assets in a piecemeal manner.

Read the original article on Business Insider

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