Thursday, October 28, 2021

Unpaid by Evergrande, supplier sells Porsche and home to save his business

GUANGZHOU, China — Guo Hui, whose cleaning business owes 20 million yuan ($3.1 million) to beleaguered real estate giant China Evergrande, is counting on the government to fix a crisis that saw his own company go bankrupt. abandoned on the brink.

Meanwhile, the 50-year-old, known as “Brother Hui” by friends and co-workers, has sold his Porsche Cayenne and taken his apartment off the market to raise cash to pay off debt and wages.

“We’ve contacted the people in charge, but they either say they don’t have money or don’t know when they can pay,” Guo told his office behind a building in an alleyway in Guangzhou’s Tianhe district. ” Lively with small restaurants and stalls.

His case is typical of countless suppliers left on the hook by China’s Evergrande, based in nearby Shenzhen, which was the country’s best-selling property developer before running short of cash under $305 billion in debt this summer. .

Originally from Sichuan province, Guo founded his cleaning business called Feiyun more than two decades ago.

Like many self-made entrepreneurs of his generation, Guo sees him as a rags-to-riches story that runs alongside China’s economic rise.

He said he has been working with Evergrande, which accounts for 90 percent of his business, since 2017, when he faced problems in June, when payments on commercial paper issued by the company stopped.

China Evergrande did not immediately respond to a request for comment on Guo’s claim.

“We are left in a very inactive state,” he said.

Feiyun provides cleaning and repair services for Evergrande Apartments in Guangdong Province, ensuring new constructions are clean before being shown to potential buyers.

Guo said it has about 100 permanent workers and uses 700 to 800 contractors depending on demand, most of them expatriates from less wealthy inland provinces.

“Frankly speaking, Evergrande really owes money to ordinary migrants who worked hard for it,” he said.

A few months ago, Guo had a team of 300 cleaning thousands of apartments on two contracts worth about 1.5 million yuan in the high-end Zhanjiang Evergrande Veten Garden development in the southwest tip of the province.

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“He worked day and night for us. I am trying my best to pay them off with the loans I have taken, but I can only manage a third or a quarter of it. Referring to employee dues on three different projects, Hui said, “We still owe them about 2 million yuan.”

Bottles of Maotai line the shelves behind Guo, the single photo on his desk showing him skiing in northern China in 2017, “before things got tough”.

An outdoor enthusiast, Guo was planning to eventually hand over his business to his son Guo Jing, who was listening nearby, so that he and his wife could travel abroad – first from the COVID-19 pandemic and then from Evergrande’s crisis plans. failed.

Beijing has remained largely calm over the situation at Evergrande, which has rocked global markets and left investors as well as hundreds of thousands of buyers of unfinished apartments facing uncertainty, sparking protests at Evergrande offices this month Is.

“We can only wait for Evergrande to sort itself out or for the government to help,” Guo said. “Never mind, I still believe in the government. It should have a conclusion.”

The next day, Guo heads to a Porsche dealership to sell back what he sees as a symbol of his hard work. After the papers were signed, he once again asked them to sit in it.

“That’s where Evergrande is,” he said at the dealership, adding that he can now only wait for the government and the courts to act.

Once out of poverty, Guo is confident that his luck will change.

“I’ll definitely buy my car back when I make some money. I’m sure I’ll get it back.”

($1 = 6.4662 Chinese Yuan Renminbi)

by David Kirton



This News Originally From – The Epoch Times

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