Berlin The bankruptcy filing of the heavily indebted Chinese real estate developer China Evergrande has fueled concerns about the state of the world’s second largest economy. The Shanghai stock exchange lost 0.4 percent to 3151 points on Friday. The index of the most important companies in Shanghai and Shenzhen fell by 0.6 percent.
Evergrande had filed for Chapter 15 bankruptcy protection in the United States. That emerges from documents of the bankruptcy court in Manhattan from Thursday.
Under Chapter 15 of the US bankruptcy law, foreign companies can be protected from lawsuits by American creditors while they reorganize in another country. Evergrande has accumulated a loss of around 72 billion euros within two years and is struggling with its creditors to reduce its mountain of debt.
The bankruptcy announcement comes amid a slew of bad news about the Chinese economy. According to media reports, the large Chinese real estate developer Country Garden only warned of payment difficulties this week.
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