Country Garden Faces Default Risks with $7 Billion Loss
Chinese homebuilder Country Garden has warned that it may default on its debts after reporting a loss of $7 billion for the first half of the year. The company attributed the poor performance to the slump in the real estate market, particularly in smaller Chinese cities. Country Garden confirmed that it had missed interest payments on some of its bonds and expressed concerns about its ability to continue as a going concern. The troubled real estate giant is facing a liquidity crisis, which has raised fears of a wider impact on China's economy. In an effort to support the property sector, a major Chinese city, Guangzhou, has relaxed mortgage rules for homebuyers. Country Garden's stock has plummeted this year, and the company is under pressure to pay off its nearly $200 billion in total liabilities.