In what is being seen as the latest sign of the major issues faced by the world’s second largest economy, one of China’s biggest property developers, Country Garden, has warned that it could see a loss of up to $7.6bn for the first six months of the year.
This comes as officials figures this week showed China had slipped into deflation for the first time in more than two years, raising questions about the pace of its post-pandemic recovery.
The BBC reports that exports have also fallen sharply, while youth unemployment is at a record high.
Shares in Country Garden Holdings were down by almost 10% in Hong Kong trade yesterday morning after the company announced that it ‘expected to record a net loss’ ranging from approximately $6.24bn to $7.6bn.
The expected loss compares to a $265m profit for the same time last year.
On Thursday, according to the BBC, rating agency Moody’s downgraded the company’s rating, citing ‘heightened liquidity and refinancing risks’.
Earlier this week, official figures showed the country’s exports fell by a larger-than-expected 14.5% in July compared with a year earlier, while imports dropped 12.4%.
[Image: Jeremy Zhu from Pixabay]