A day later, tens of thousands of homeowners threatened to stop paying mortgages on scores of unfinished housing projects they had purchased. All of this happened in a week where the officials reported lacklustre second-quarter economic performance .
China’s economy is facing a dangerous cocktail of stalling growth, high unemployment, spreading mortgage payment strikes and continued Covid shutdowns that threaten to explode with serious social and political consequences.
The worsening meltdown in the country’s debt-laden property market is at the heart of the problem as the toxic $300bn (£250bn) debt pile unleashed by last year’s collapse of the giant developer Evergrande slowly infects the whole economy .
The initial official response to the bank demonstration was to call in squads of plain-clothed enforcers to use violence to break it up. Authorities have since claimed the bank ha d been taken over by “criminal gangs” and have promised to start allowing access to the money .
When it emerged last week that homebuyers across the country were banding together to refuse payments on mortgages on homes left unfinished by debt-distressed developers, it was another sign that the faith of ordinary Chinese people in the property market and wider banking industry is beginning to dissolve. “Why do I have to pay a mortgage when the property I bought has yet to be finished?” demanded one angry social media user after watching a viral documentary about how hundreds of homebuyers in the central city of Xi’an have to live in unfinished apartments.
Bu hikaye The Guardian dergisinin July 20, 2022 sayısından alınmıştır.
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Bu hikaye The Guardian dergisinin July 20, 2022 sayısından alınmıştır.
Start your 7-day Magzter GOLD free trial to access thousands of curated premium stories, and 9,000+ magazines and newspapers.
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