China’s largest private developer has warned it could default on its international debts, dealing another blow to the country’s embattled property industry. Country Garden has about $200bn (£163bn) in liabilities and nearly $11bn in dollar-denominated offshore bonds. It has not defaulted so far, but has missed coupon payments on some dollar bonds since last month and faces the end of 30-day grace periods for making payments from next week. It said in a statement to the Hong Kong stock exchange the company said that it “expects that it will not be able to meet all of its offshore payment obligations when due or within the relevant grace periods, including but not limited to those under the US dollar notes issued by the company”. It added: “Such non-payment may lead to relevant creditors of the group demanding acceleration of payment of the relevant indebtedness owed to them or pursuing enforcement action.” Country Garden faces a big test next week when its entire offshore debt could be deemed in default if it fails to pay a $15m September coupon by 17 October, at the end of a 30-day grace period. The company said in Tuesday’s statement that its sales and financing were facing “significant challenges”, with sales “under remarkable pressure”, and its available funds had continued to decline. It said it would “make its best effort to ensure the delivery of properties, which is the group’s most critical corporate responsibility and is the key pillar to safeguard the property market”. Its share price fell more than 10% in Hong Kong, and is down about 70% this year. The property sector has been in crisis since Evergrande, the world’s most indebted developer, defaulted on some debts in 2021. As property accounts for roughly a quarter of China’s economy, the crisis has dragged down overall economic growth. It was triggered by a regulatory crackdown, with the Chinese government concerned about high debt levels in the property sector, which meant Evergrande found itself unable to make interest repayments on more than $300bn in debt in late 2021, sending China’s housing development sector into a liquidity crisis. Last week, Alicia García-Herrero, the chief economist for Asia Pacific at the French investment bank Natixis said “Country Garden is as big a problem” as Evergrande in terms of the health of China’s real estate and commercial sectors. Companies accounting for 40% of Chinese home sales have defaulted on debts since the liquidity crisis hit the sector in 2021, leaving many properties unfinished. Beijing has rolled out a raft of measures in recent months, including reducing deposit requirements and cutting existing mortgage rates, to help revive homebuyers’ confidence. Country Garden said it had appointed the investment bank Houlihan Lokey, along with the partially state-owned firm China International Capital Corporation and the law firm Sidley Austin as advisers to examine its capital structure and liquidity position and come up with a “holistic solution”.