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Caixin

How Evergrande could turn into 'China's Lehman Brothers'

Collapse of 'too big to fail' property developer may trigger financial tsunami

For the past two months, hundreds of people have been gathering at the 43-floor Zhuoyue Houhai Center in Shenzhen, where China Evergrande Group's headquarters occupies 20 floors. They hold banners demanding repayment of overdue loans and financial products. Police with riot shields stand guard to keep the crowds under control.

The demonstrators are construction workers from the property developer's housing projects, suppliers providing construction materials, and investors in the company's wealth management products (WMPs). From paint suppliers to decor and construction companies, Evergrande owes more than 800 billion yuan ($124 billion) due within one year, while it has only a 10th of that in cash.

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