Global economy health at stake as China tries to hold sneeze

Hong Kong

IT used to be that when America sneezed, the world caught a cold. This time around, it's the risk of a sickly China that poses a bigger threat.

The world's second-largest economy is now trying to ward off the sniffles. While output is still growing at a pace that sees gross domestic product (GDP) double every decade, the problem remains that much of that has been fuelled by a massive build-up of credit.

Total borrowing climbed to about 260 per cent of the economy's size by the end of 2016, up from 162 per cent in 2008, and will hit close to 320 per cent by 2021, according to Bloomberg Intelligence (BI) estimates. Economy-wide debt levels are on track to rank among "the highest in the world",...

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