Country Garden Holdings, once China's largest property developer by sales, was considered a relatively safe player in China's property sector — focused on smaller cities and less leveraged than Evergrande. But in August 2023, the company missed interest payments on its dollar-denominated bonds, signaling a default on over $300 billion in liabilities.
The default was a shock because Country Garden had been seen as a survivor of the property crackdown that had already taken down Evergrande and other developers. The company's collapse demonstrated that China's property crisis was not limited to the most reckless developers — it was systemic, affecting even those who had been considered prudent.
Country Garden's collapse deepened China's property crisis, which had already wiped out trillions of dollars in household wealth and threatened the broader economy. The case illustrated how a debt-fueled growth model, even when managed more conservatively than the worst offenders, is still a debt-fueled growth model — and when the market turns, conservatism only determines the order of collapse, not whether it happens.
Defaulted on $300B+ liabilities, proving the property crisis was systemic: conservatism only determined the order of collapse, not whether it happened.
Country Garden was considered a safe player but still carried $300B+ in liabilities.
The company missed bond payments in August 2023, signaling default.
The collapse demonstrated that China's property crisis was systemic, not limited to reckless developers.
The default deepened China's property crisis and threatened the broader economy.
In a debt-fueled boom, conservatism determines the order of collapse, not whether it happens. Country Garden was prudent, but the model was the same: borrow, build, sell, repeat.
Country Garden entered restructuring. The collapse deepened China's property crisis and prompted government stimulus measures. The case is cited alongside Evergrande as evidence that China's property model was fundamentally unsustainable.
FOLLOW THE EVIDENCE