Deepening problems for Chinese economy

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The major economic and financial problems in the Chinese property development sector continue to mount with the announcement by Fantasia Holdings this week that it had failed to make a payment on a bond.

Just a few weeks ago, Fantasia issued an assurance that it had “no liquidity issue” but on Monday announced “that it did not make the payment” on a $206 million bond.

A man wearing a protective mask walks in front of an electronic display board in the lobby of the Shanghai Stock Exchange building in Shanghai, China, Friday, Feb. 14, 2020. (AP Photo)

Last month Evergrande, the most indebted property development company, missed a payment on a dollar-denominated bond, triggering a 30-day grace period before a default is declared.

The question being asked in Asian markets is how far the financial crisis will spread to other property developers, which account for a large portion of the high-yield or so-called junk bond market.

Dickie Wong, the head of…

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