China's factory activity contracted at the sharpest rate in 23 months in January, underscoring the huge economic costs from the country's zero-COVID approach as surging cases and tough containment measures weighed on output and demand, a private survey showed on Sunday, Reuters reported. The Caixin/Markit Manufacturing Purchasing Managers' Index (PMI) fell to 49.1 in January - its lowest level since February 2020, when the economy was still suffering from country-wide COVID-19 lockdowns in the early days of the pandemic.

Embattled property developer China Evergrande Group said Wednesday that within six months, it aims to release a global restructuring plan that would respect offshore creditors’ legal rights, after a group of its bondholders threatened last week to sue the company for failing to engage with them, WSJ Pro Bankruptcy reported. During a call with offshore creditors, Evergrande promised to follow the rule of law and respect bondholders’ rights, which in some cases include claims on the company’s secured offshore assets, according to people familiar with the matter.

China Evergrande Group shares slumped on Thursday after the developer's thinly detailed roadmap for restructuring left investors dissatisfied and its indebted peers also fell on concerns higher interest rates would raise financing costs, Reuters reported. Regulatory curbs on borrowing have driven China's property sector into crisis, highlighted by Evergrande, the world's most indebted property firm.

China Evergrande Group asked international creditors to give the giant property developer more time to get a grip on its complicated financial situation, and warned that drastic legal action could be destabilizing, the Wall Street Journal reported. The plea came days after a group of international bondholders threatened to enforce their legal rights against Evergrande, saying that they had been unable to engage substantively with the troubled Chinese real-estate company for months.

Chinese developer Yuzhou Group Holdings Co. said that it won’t pay off two dollar bonds due this week, meaning some events of default will occur, as builders continue to struggle meeting debt payments, Bloomberg News reported. The company earlier this month offered to swap the notes for new debt, and investors exchanged most of their holdings. There’s $104.9 million of combined principal remaining, Yuzhou said in a Monday stock exchange filing, and it’s opting not to pay that while planning to relaunch the exchange offer this week.

The provincial government leading China Evergrande Group's restructuring wants to separate the company's offshore assets and sell them to pay off foreign debt, a media report said on Friday, in a boost to foreign lenders' hopes of recouping funds, Reuters reported. Financial intelligence provider REDD said on Friday that the provincial government in Guangdong, where Evergrande is based, aimed to release a framework debt restructuring plan by March that could also wipe out the 60% stake of the group's chairman.

China Aoyuan Group Ltd. was downgraded to restricted default by Fitch Ratings two days after the Chinese developer flagged its intention to renege on debt obligations, Bloomberg News reported. Aoyuan hasn’t provided further information to the rating agency beyond its announcement that it won’t make payments on four dollar bonds, which would trigger defaults on all other offshore debt, Fitch said in a statement Friday. Earlier in the day, Moody’s also withdrew its ratings on the builder citing insufficient information.

Country Garden Holdings Co. is raising HK$3.9 billion ($500 million) from the sale of convertible bonds, a show of strength by the embattled property giant after a report last week that it was struggling to issue debt, Bloomberg News reported. The fundraising announcement from China’s largest developer by sales helped boost its dollar bonds on Friday, extending a massive rally that saw its 2024 note rise to 94 cents on the dollar from Monday’s record closing low of 70 cents, according to Bloomberg-compiled prices.

An ad hoc offshore creditors group of China Evergrande said on Thursday that it has had no substantive engagement with the firm over its restructuring plans despite the firm's repeated assurances, Reuters reported. The group, represented by law firm Kirkland & Ellis and investment bank Moelis & Company, said in a statement it has no option but to seriously consider enforcement actions and it is prepared to take all necessary actions to defend its legal rights.

China Aoyuan Group Ltd. won’t make payments on four dollar bonds and said that will trigger defaults on all other offshore debt, becoming the latest Chinese developer to succumb to the industry’s liquidity crisis, Bloomberg News reported. The company won’t pay off a dollar note that matures Thursday or a separate bond due Sunday, it said in a Hong Kong stock exchange filing late Wednesday. The notes have a combined $688 million of principal outstanding, according to data compiled by Bloomberg.