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George Magnus warns of ‘domino effect’ of Chinese real estate debt By Investing.com


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By Laura Sánchez

Investing.com – China’s real estate debt problems are likely to lead to a period of stagnation affecting both the national and global economies, according to George Magnus, an economist and researcher at the University of Oxford.

The shares of the Chinese real estate giant Kaisa Group Holdings (HK 🙂 were suspended from trading last Friday following news of the non-payment of a wealth management product. This is a test of the domino effect of the crisis of Evergrande (HK 🙂 Group.

Of all the challenges facing the world’s second-largest economy in the coming years, Magnus argued that debt, related to real estate in particular, could be the most problematic.

“I think it is the debt that is really imminent, and I think we can see this in the real estate sector, which is a kind of metaphor for what is happening in the rest of the economy between local governments, state companies, etc., “Magnus said in statements to CNBC.

Magnus suggested that after at least two decades of expansion in the Chinese real estate market, due to the government’s willingness to intervene in this sector, it is possible that Beijing will see the danger of the domino effect to other sectors.

“I hope China tries to help the real estate sector this year and in 2022 before the November congress, but I think the market is facing years of stagnation, to be honest.”

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HELEN HERNANDEZ

Helen Hernandez is our best writer. Helen writes about social news and celebrity gossip. She loves watching movies since childhood. Email: Helen@oicanadian.com Phone : +1 281-333-2229

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