IMF Official Says Evergrande Risks Are ‘Contained’, Just Like We Predicted

20th October 2021
IMF Official Says Evergrande Risks Are ‘Contained’, Just Like We Predicted

A senior official at the International Monetary Fund has said risks stemming from the China Evergrande crisis are “contained” for now.

Helge Berger, head of the fund’s China mission, made the remarks on Bloomberg Television.

“People understand that the government has the tools to contain the risks going forward”, he said, adding that the risks are contained to the property sector.

However, Berger warned that authorities should still continue to monitor the situation in case it escalates.

With liabilities totalling USD 300 billion, China Evergrande is the world’s most indebted property developer.

Berger also said that whilst authorities should make an effort to deleverage the leveraged property industry, they should do so cautiously.

Recent comments from Standard Chartered CEO Bill Winters echoed a similar message that the Evergrande crisis will be contained, stating China “isn’t dumb enough to have a Lehman Brothers moment”.

Our stance at Bread has long been that Evergrande’s crisis will not unfold like the 2008 housing crash in the US. Moreover, we also believe Evergrande rivals Country Garden and Sunac won’t follow suit in collapsing.

Image credit: Bread News

Written by Bread News Team
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