'Fallen Angel' Shimao Shows Fragility of China Property Sector

The transcript discusses the financial concerns surrounding Chinese companies like Evergrande and Shimao, focusing on the potential contagion effects and liquidity issues due to government regulations. Shimao's financial health is highlighted, noting its investment-grade ratings and significant debt. The potential collapse of Shimao could disrupt the recovery of Chinese dollar junk bonds. Regulatory measures are being considered to ease currency conversion for developers under stress, with the State Administration of Foreign Exchange ensuring liquidity to meet dollar obligations.

Discuss the implications of a potential collapse of a higher-rated firm like Shimao on the Chinese market.

What role does the State Administration of Foreign Exchange (SAFE) play in the context of the dollar bond obligations?