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Evergrande: Chinese property giant delisted after spectacular fall

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Evergrande: Chinese property giant delisted after spectacular fall


Peter Hoskins

Business reporter, BBC News

AFP via Getty Images A woman - wearing a mask, pink t-shirt with a Mickey Mouse emblem on the right sleeve and black trousers - rides a scooter past the construction site of an Evergrande housing complex in Zhumadian, central China's Henan province.AFP via Getty Images

Evergrande was once China’s biggest property developer

Chinese property giant Evergrande’s shares were taken off the Hong Kong stock market on Monday after more than a decade and a half of trading.

It marks a grim milestone for what was once China’s biggest real estate firm, with a stock market valuation of more than $50bn (£37.1bn). That was before its spectacular collapse under the weight of the huge debts that had powered its meteoric rise.

Experts say the delisting was both inevitable and final.

“Once delisted, there is no coming back,” says Dan Wang, China director at political risk consultancy Eurasia Group.

Evergrande is now best-known for its part in a crisis that has for years dragged on the world’s second-largest economy.

What happened to Evergrande?

Just a few years ago Evergrande Group was a shining example of China’s economic miracle.

Its founder and chairman Hui Ka Yan rose from humble beginnings in rural China to top the Forbes list of Asia’s wealthiest people in 2017.

His fortune has since plummeted from an estimated $45bn in 2017 to less than a billion, his fall from grace as extraordinary as his company’s.

In March 2024, Mr Hui was fined $6.5m and banned from China’s capital market for life for his company overstating its revenue by $78bn.

Liquidators are also exploring whether they can recover cash for creditors from Mr Hui’s personal property.

At the time of its collapse, Evergrande had some 1,300 projects under development in 280 cities across China.

The sprawling empire also included an electric carmaker and China’s most successful football team, Guangzhou FC, which was kicked out of the football league earlier this year after failing to pay off enough of its debts.

AFP via Getty Images Gold and pink confetti rains down as head coach Fabio Cannavaro of Guangzhou Evergrande and his players celebrate winning the 2019 Chinese Super League title on 1 December, 2019 in Guangzhou, Guangdong Province of China. AFP via Getty Images

Evergrande owned China’s most successful football club

Evergrande was built on $300bn (£222bn) of borrowed money, earning it the unenviable title of the world’s most indebted property developer.

The rot set in after Beijing brought in new rules in 2020 to control the amount big developers could borrow.

The new measures led Evergrande to offer its properties at major discounts to ensure money was coming in to keep the business afloat.

Struggling to meet interest payments, the firm soon defaulted on some of its overseas debts.

After years of legal wrangling, the Hong Kong High Court ordered the company to be wound up in January 2024.

Evergrande’s shares had been under threat of delisting ever since because they were suspended from trading after the court order.

By that point the crisis engulfing the firm had wiped more than 99% from its stock market valuation.

The liquidation order came after the company was unable to offer a workable plan to shed billions of dollars of overseas liabilities.

Earlier this month, liquidators revealed that Evergrande’s debts currently stand at $45bn and that it had so far sold just $255m of assets. They also said they believe a complete overhaul of the business “will prove out of reach”.

The “delisting now is surely symbolic but it’s such a milestone,” Ms Wang says.

All that remains is which creditors are paid and how much they can get in the bankruptcy process, says Professor Shitong Qiao from Duke University.

The next liquidation hearing is due to take place in September.

How was China’s economy impacted?

China is facing a number of major problems, including US President Donald Trump’s tariffs, high local government debt, weak consumer spending, unemployment and an ageing population.

But experts say Evergrande’s collapse, along with the serious problems faced by other developers, has hit the country hardest.

“The property slump has been the biggest drag on the economy, and the ultimate reason why consumption is suppressed,” Ms Wang says.

Getty Images Hui Ka Yan, chairman of China Evergrande Group, speaks during a news conference in Hong Kong, China, on Tuesday, March 26, 2019.Getty Images

Evergrande chairman Hui Ka Yan was once Asia’s wealthiest person

This is particularly problematic as the industry accounted for about a third of the Chinese economy and was a major source of income for local governments.

“I don’t think China has found a viable alternative to support its economy at a similar scale,” Professor Qiao says.

The property crisis has led to “massive layoffs” by heavily-indebted developers, Jackson Chan from financial markets research platform Bondsupermart says.

And many real estate industry employees that kept their jobs have seen big pay cuts, he adds.

The crisis is also having a major impact on many households as they tend to put their savings into property.

With housing prices dropping by at least 30%, many Chinese families have seen their savings fall in value, says Alicia Garcia-Herrero, chief economist for Asia Pacific at French bank Natixis.

This means they are less likely to spend and invest, she adds.

In response, Beijing has announced a raft of initiatives aimed at reviving the housing market, stimulating consumer spending and boosting the wider economy.

They range from measures to help new home owners and support the stock market to incentives to buy electric cars and household goods.

Despite the hundreds of billions of dollars Beijing has poured into the economy, China’s once-blistering growth has eased to “around 5%”.

While most Western countries would be more than happy with that, it’s slow for a country that saw growth of more than 10% a year as recently as 2010.

Is the property crisis over yet?

In short, probably not.

Even as Evergrande continues to grab headlines, several other Chinese property firms are still facing major challenges.

Earlier this month, China South City Holdings was handed a winding up order by Hong Kong’s High Court, making it the biggest developer to be forced into liquidation since Evergrande.

Meanwhile, rival real estate giant Country Garden is still trying to secure a deal with its creditors to write off more than $14bn of outstanding foreign debt.

After a series of postponements, its next High Court liquidation hearing in Hong Kong is due to take place in January 2026.

“The whole property sector has been in trouble. More Chinese property firms will collapse,” Professor Qiao says.

AFP via Getty Images People wearing coats and hats walk past an Evergrande Group residential complex called Evergrande Palace in Beijing on 30 January, 2024 on a misty overcast day.AFP via Getty Images

Experts say the removal of Evergrande’s share from the Hong Kong stock market was inevitable

While the Chinese government has taken a number of measures to help shore up the property market and support the economy as a whole it has not swooped in to directly bail out developers.

Mr Chan says these initiatives seem to be having a positive impact on the property market: “We think the bottom [has been reached] and it should be in a slow recovery. However, we probably don’t expect the recovery to be very strong.”

Wall Street investment giant Goldman Sachs warned in June that property prices in China will continue to fall until 2027.

Ms Wang agrees, and estimates that China’s stricken property market will “hit the bottom” in around two years when demand finally catches up with supply.

But Ms Garcia-Herrero puts it in starker terms: “there is no real light at the end of the tunnel.”

Beijing has sent a “clear message on its intention of not bailing out the housing sector,” Ms Wang adds.

The Chinese government has been careful to avoid the kind of measures that could encourage further risky behaviour by an already heavily indebted industry.

And while in the boom times, the property market was a key driver of China’s economic growth, the ruling Communist Party’s priorities now lie elsewhere.

President Xi Jinping is more focussed on high-tech industries like renewable energy, electric cars and robotics.

As Ms Wang puts it, “China is in a deep transition to a new age of development.”



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ICAI in talks to provide data for sovereign AI – The Times of India

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ICAI in talks to provide data for sovereign AI – The Times of India







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Paraguay – the Silicon Valley of South America?

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Paraguay – the Silicon Valley of South America?


Jane ChambersBusiness reporter, Asunción, Paraguay

Gabriela Cibils Paraguayan tech boss Gabriela Cibils smiles at the cameraGabriela Cibils

Gabriela Cibils wants to help Paraguay attract big tech from the US and elsewhere

Gabriela Cibils is on a mission – to help turn Paraguay into the Silicon Valley of South America.

When she was growing up in the landlocked country, nestled between Brazil and Argentina, she says the nation “wasn’t super tech focused”.

But it was different for Ms Cibils, as her parents worked in the technology sector. And she was inspired to study in the US, where she got a degree in computing and neuroscience from the University of California, Berkeley.

After graduating she spent eight years working in Silicon Valley, near San Francisco, with roles at various American start-ups.

But rather than staying permanently in the US, a few years ago she decided to return home to Paraguay. She’s now helping to lead efforts to build a large and successful tech sector that puts the country of seven million people on the world map – and attract some of the globe’s tech giants.

AFP via Getty Images Water gushing out of the giant Itaipu Dam on the Paraná River between Paraguay and BrazilAFP via Getty Images

The giant Itaipu Dam produces 90% of Paraguay’s electricity needs

“I saw first hand the impact that technology can have on your life,” says Ms Cibils. “After being exposed to such a different world [in Silicon Valley], it’s my responsibility to bring that mindset back and combine it with the talent I see in Paraguay.”

She is now a partner at global technology and investment firm Cibersons, whose headquarters is in Paraguay’s capital Asunción.

While most countries would love to build a world-class tech sector, Paraguay has a distinct advantage in one regard – an abundance of cheap, green electricity.

This is thanks to 100% of its generation now coming from hydroelectric power.

This is centred on the giant Itaipu Dam on the Paraná River, which forms part of the border between Paraguay and Brazil. This huge hydroelectric power station, the largest in the world outside of China, supplies 90% of Paraguay’s electricity needs, and 10% of Brazil’s.

In fact, such is Paraguay’s surplus of electricity that its electricity prices are the lowest in South America.

And it is the world’s largest exporter of clean energy.

The Paraguayan government hopes that the country’s abundance of cheap, green electricity will attract global tech firms increasingly focused on the massive energy demands of AI computing.

“If you want to install any technology investment like AI data centres, keep in mind hydroelectric power is both renewable and steady,” says Paraguayan software development entrepreneur Sebastian Ortiz-Chamorro.

“Compared to other renewable energy sources like wind or solar, that have their ups and downs, it’s much more attractive for creating data centres or any other electro intensive activity that requires a steady electricity source.”

He adds that in addition to Itaipu, and Paraguay’s other large state-owned hydroelectric plant, the Yacyretá Dam, private companies can easily build their own smaller facilities.

A map showing the location of Paraguay's two main hydroelectric dams

On a visit to California last year Paraguay’s President Santiago Peña spoke with companies like Google and OpenAI to encourage them to invest in Paraguay. It remains to be seen if such industry giants open large operations in the country.

Minister of Technology and Communication Gustavo Villate is working closely with the president on the continuing efforts.

“We have the youngest population. We have a lot of renewable green energy. We have low taxes and economic stability,” he says proudly.

I’m taken on a tour with the minister of a planned new digital park near Asunción’s main airport. It’s currently green fields and some army barracks.

Mr Villate unfurls plans to show off the lakes, a childcare centre and other buildings which he says should be ready in under two years.

“The government are going to invest around $20m (£15m) for the first stage, but the idea is for private companies to invest the rest,” he says.

Even though the park isn’t ready yet, Mr Villate says the collaboration already happening between the public, private and university sectors is key to building an ecosystem to attract foreign investors.

The government thinks the country’s young population will be a key attraction, and able to provide a large tech workforce. The average age in Paraguay is 27.

Vanessa Cañete Vanessa Cañete looks at the cameraVanessa Cañete

Vanessa Cañete says Paraguay is working hard to train more young people in technology

But more young people will need to be trained. The technology minister says the new digital park will also be home to The University of Technology, which is a joint venture between Taiwan and Paraguay.

Meanwhile, there are other initiatives to train young people in the country. “We are working really hard to create a mass of software engineers, programmers and everything you need to provide software services,” says Vanessa Cañete, president of trade group Paraguayan Chamber of the Software Industry.

Ms Cañete says she is also passionate about encouraging more women to study computer engineering. In 2017 she set up Girls Code, a non-profit association which aims to close the tech gender gap.

It organises programming and robotics workshops for teenagers and young women, with more than 1,000 receiving some sort of training to date.

Ms Cañete adds that software developers are also given English lessons for up to four years to improve their communication with overseas firms.

The people I met are brimming with positivity about what Paraguay has to offer the tech world, but they are also pragmatic.

Ms Cibils says there are still “growing pains” for foreign investors, with issues like bureaucracy, which can hold things up adapting local contracts to standardised international ones.

But she is adamant that “if you put innovation at its core and leverage all the benefits that the country has I think Paraguay can be a superpower”.



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Five carmakers go on trial over emissions cheat claims

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Five carmakers go on trial over emissions cheat claims


Emer MoreauBusiness reporter

Getty Images A close up of a white car's exhaust pipe emitting fumesGetty Images

A major lawsuit against five leading carmakers accused of cheating on emissions tests is set to begin at the High Court on Monday.

The trial is the latest chapter of what has become known as the “dieselgate” scandal, with the companies facing allegations they used software to allow their cars to reduce emissions of harmful gases under test conditions.

Lawyers say the case is the largest class action in English and Welsh legal history, and could eventually involve 1.6 million car owners.

The five carmakers – Mercedes, Ford, Peugeot/Citroën, Renault and Nissan – all deny the accusations.

The five have been chosen by the court as lead defendants to be tried first as the case is so big.

Mercedes, Ford, Peugeot/Citroën, Renault and Nissan have been accused by 220,000 car owners of misleading them over emissions tests.

But depending on the outcome of this case, nine other carmakers are facing similar claims.

The dieselgate scandal first emerged in September 2015, when the US Environmental Protection Agency accused Volkswagen of installing software – known as “defeat devices” – on diesel cars to lower readings of the cars’ nitrogen oxide emissions.

In 2020, the High Court ruled that Volkswagen had used defeat devices in breach of European Union rules to pass emissions tests.

Volkswagen settled a class action out of court, paying £193m to 91,000 British motorists.

The company has so far paid out more than €32bn (£27.8bn) over the scandal, mostly in the US.

The High Court will decide whether systems installed in diesel cars by the five carmakers were designed to cheat clean air laws.

It is alleged the “defeat devices” allowed a car to identify when it was in a test scenario. It would then run its engine at below normal power and performance levels in order to record lower readings of nitrogen oxides.

Lawyers for the motorists will claim they were deceived about how environmentally friendly the vehicles were, and that the cars still on the road are continuing to emit dangerous levels of pollution.

Although the trial begins on Monday, a judgement is not expected until summer 2026. If the court finds against the carmakers, a further trial to determine levels of compensation is expected to begin in autumn 2026.

Martin Deigh of Leigh Day, which is one of the 22 law firms representing drivers, said: “A decade after the Dieselgate scandal first came to light, 1.6 million UK motorists now get their chance to establish at trial whether their vehicles contained technology designed to cheat emissions tests.”

He said that if the allegations against the car firms are upheld in court it “would demonstrate one of the most egregious breaches of corporate trust in modern times”.

“It would also mean that people across the UK have been breathing in far more harmful emissions from these vehicles than they were told about, potentially putting the health of millions at risk.”

The companies involved have said the claims against them are without merit.

A spokesperson for Mercedes said the mechanisms used in tests were “justifiable from a technical and legal standpoint”.

Renault and Stellantis, which owns Peugeot and Citroen, said the vehicles it sold were compliant with regulations at the time.

Ford said the claims had “no merit” and Nissan said it was “committed to compliance in all markets in which we operate”.



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