One of the cautionary notes in the Bank of England’s Financial Stability Report this week related to China.
The Bank warned that indebtedness in China was "pronounced" and posed a potential risk to the UK economy.
So what's going on with Chinese debt?
In one word – it’s ballooning.
Chinese debt is now at almost $33 trillion, with domestic debt having quadrupled in the past 9 years.
To give some perspective, China’s total debt has now surpassed 300% of GDP.
This is over three times our debt to GDP ratio in the UK.
To be clear, it’s not that we’re likely to see bank collapses - the kind of problems we say in the West that promoted global financial crisis.
This is because much of the debt is owed to state owned banks by state owned companies.
And government, when push comes to shove, would intervene.
The point is that this intervention would come at a significant cost.
Several China experts I’ve spoken to have told me of their concerns that should the government intervene, this could mean a significant drop in China’s rate of growth.
Given how dependent the rest of world is on China, such a drop, if it were to happen, would have a marked effect on the global economy including on us in the UK.