This Cleaning Entrepreneur From China Has To Sell His Porsche Cayenne And Apartment Because The Evergrande, Owned By The Conglomerate Hui Ka Yan, Has IDR 44 Billion In Debt

Illustration. (Photo: Wikimedia Commons)

JAKARTA - The huge debt from the Chinese property company, Evergrande, has also affected other entrepreneurs. One entrepreneur in the cleaning business named Guo Hui, is on the verge of bankruptcy because Evergrande owes him up to 20 million yuan or USD 3.1 million (approximately IDR 44 billion).

Quoted from Reuters, Wednesday, September 29, Go Hui has even sold a Porsche Cayenne and is trying to sell an apartment in an effort to raise money to pay the debt Evergrande to his own company. He also has to bear the wages of employees.

Guo is a 50-year-old businessman from Sichuan Province. He founded a cleaning business under the Feiyun name more than two decades ago.

Like many self-employed entrepreneurs of his generation, Guo sees his business journey as a get-rich-quick story as China's economy rises. Feiyun provides cleaning and repair services for Evergrande apartments in Guangdong Province. Feiyun made sure that the new building was clean before showing it to potential buyers.

Feiyun has around 100 permanent staff and employs 700-800 contractors depending on demand. Most of the employees are migrants from the less wealthy hinterland provinces.

"Frankly, Evergrande really owes money to ordinary migrants who work hard for it," Guo said.

A few months ago, Guo had a team of 300 people working day and night cleaning thousands of apartments in the upscale Zhanjiang Evergrande Waitan Gardens project development. Feiyun is under two contracts worth about 1.5 million yuan to clean up a project in the southwestern tip of the province.

"I did my best to repay them from the loans I had taken but I could only manage a third or a quarter," Guo said.

Guo said he still owes about 2 million yuan to hundreds of employees. The debt refers to staff arrears on three different projects.

Guo through his company has been working with Evergrande since 2017. Work with Evergrande accounts for 90 percent of the total business run as of June 2021.

That same month, Guo began to face problems when payments for commercial paper issued by Evergrande stopped. Guo claimed to have contacted the people responsible for Evergrande.

"But they said they didn't have the money or didn't know when they could settle the payments," Guo said

Guo's case is typical of many suppliers abandoned by Shenzhen-based Evergrande. Evergrande, originally the best-selling property developer in China, is currently running out of cash with a debt burden of USD 305 billion or around IDR 4.200 trillion.

Unfortunately, the Chinese government has been largely silent in responding to the Evergrande situation that has rocked global markets. In fact, investors and hundreds of thousands of buyers of apartments that have not been completed, are also facing uncertainty.