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The richest woman in Asia loses half of her fortune of almost 24,000 million due to the real estate crisis in China

Country Garden majority shareholder Yang Huiyan’s net worth plummeted by more than 52% to $11.3 billion from the 23.7 billion it was valued at in 2021.

Yang Huiyan, the richest woman in Asia, has lost more than half of her fortune in the last seven months, as the crisis in the real estate sector in China worsens. property of the majority shareholder of the main real estate developer of the Asian giant, Country Garden, plummeted by more than 52% to 11.3 billion dollars, compared to the 23.7 billion it was valued at last year, according to revealed this Thursday the Bloomberg Billionaires Index.

Once again this Wednesday, Yang’s fortunes took a heavy hit after Hong Kong-listed shares in Country Garden shrank 15%, a drop of nearly $2 billion after the company announced it would raise more than $343 million through the sale of new shares at a discount to pay, in part, some of its debts.

“Investors are concerned that the bo mortgage boycott to spread to Country Garden as they are seeing the number of boycotted projects increasing rapidly”, pointed to Bloomberg Kenny Ng, a strategist at Everbright Securities International in Hong Kong. “The company continues to have significant debts and posted lower month-on-month growth in June sales, despite China resumed construction,” he added.

The businesswoman inherited her wealth when her father—Country Garden founder Yang Guoqiang—transferred his shares to her in 2005. Two years later, at the age of 25, she became the richest woman in Asia after the company went public on the Hong Kong stock exchange. However, now Fan Hongwei, a chemical fiber tycoon, is close behind as the second richest woman on the continent with a net worth of $11.2 billion.

Crisis in the Chinese real estate sector

In 2020, the Chinese authorities took action to contain excessive indebtedness in the real estate sector, leaving big companies like Evergrande and Sunac with difficulties in meeting their payments and forcing them to renegotiate with their creditors, which placed them on the verge of bankruptcy. Buyers across the country have begun withholding mortgage payments on homes sold before completion.

I know calculates that the real estate sector represents between 18% and 30% of the gross domestic product (GDP) of the Asian country, being a key driver of cr rise of the second world economy. Analysts have warned that the sector is immersed in a “vicious circle” that, after the publication of the dismal growth figures for the second quarter, the worst since the start of the coronavirus pandemic, further undermines consumer confidence.

“The recent mortgage boycott highlighted the impact on the real estate sector of bond defaults on unfinished real estate projects”, he claimed previously told AFP Ken Cheung, a chief currency strategist in Asia at Japanese bank Mizuho. “This forms a vicious circle in the real estate sector. With confidence in the prospects of the real estate sector falling, home buyers are delaying their purchases, and property prices fall,” he added.

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