The worry now is that the fall-out from the default may not be contained within China, which has for many decades relied on the property market for its supercharged economic growth and urbanisation. A crash in the Chinese property market will have a massive effect on the nation's economic growth and cause a ripple effect throughout the world economy. In August, billionaire investor George Soros warned that an Evergrande default could cause China’s economy to crash.

If Beijing is no longer willing to bail out foreign and domestic bondholders, then China will face a looming credit crunch that could affect everything from the prices of its exports to global supply chain issues.

The cash-strapped property developer had a 30-day grace period to pay offshore bondholders, but some of the debt payments failed to materialise.

There is now a worrying liquidity crisis in China's once bubbling property market.

The ripple effect has caused smaller developers, such as Kaisa Group Holdings, to signal that they are unlikely to meet their $400 million offshore debt deadline on Tuesday.

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There have been moves to contain the fallout of Evergrande's default within China, and a restructuring of its overseas debt has helped reassure global investors.

Speaking to Reuters, strategist Kenny Ng at Everbright Sun Hung Kai Securities claimed investors expected the Evergrande non-payment after the grace period, and "just waited to see when this will happen".

Mr Ng added: "At the same time, investors are watching the development of Evergrande.

"This includes whether it is heading for debt restructuring or its creditor repayment plan."

Speaking to Reuters one of the bondholders linked to Evergrande's default said on Monday it had established a risk-management committee that included Chinese officials to assist in "mitigating and eliminating the future risks".

The bondholder added that creditors had demanded $260 million, but it could not guarantee funds to repay debt.

The $260 million repayment demand showed Evergrande's liquidity remained "extremely weak" according to ratings firm S&P.

The ratings firm forecast that a default by Evergrande was now looking inevitable especially given maturities totalling $3.5 billion in March and April 2022.

The information on Kaisa Group and Evergrande was reported by Reuters, however, all the sources used from within China declined to be named as they were not authorised to talk to the media.

Evergrande property group have been contacted for a right of reply, but have yet to respond.