That China has borrowed too much seems incontrovertible. Total debt to gross domestic product, a measure including public, consumer and corporate borrowing, has risen sharply to 230 per cent of GDP – much higher than before the global financial crisis, and comparable to levels that have led to severe problems elsewhere.

Those who are bearish on China seize on this ratio as evidence that the country is heading for a crash, a debt-driven hard landing. They highlight the industrial overcapacity and excess of built infrastructure as the inevitable consequences of such debt-fuelled growth. They remark on the rapid increase and opacity of shadow banking. And they point to stresses in the interbank market, the recent default of a bond issued by a solar company and the weakness in the renminbi as warning signals of an imminent implosion.

Yet to jump to the conclusion that such a crash is inevitable is wrong. Equating China’s debt problem with what occurred in the US and Europe before the crisis ignores some important differences. To start with, while China borrows a lot it also saves a lot. So it has largely been borrowing from itself. This is very different from being dependent on foreign creditors.