3. How big, how dangerous?
Pieter Bottelier, SAIS
No single reliable source on China’s total debt and its composition. Estimates range from 247% to close to 300% of GDP—but is this dangerous?
At what level of overall debt may a debt crisis occur? Hard to say.
Some countries with lower overall debt level than China have experienced debt crises. Others with a higher level (e.g. Japan) haven’t.
Comment: Most debt crises start with liquidity problems. Although China has some unique features, this could also happen in China.