The economic fallout from the pandemic is starting to feel like 2008 reprised. Share prices have slumped. The global economy is lurching toward recession and unemployment is swelling. Once again, policymakers, investors and others are asking a crucial question: can China revive the world’s economy?

China — where the coronavirus outbreak originated — appears on track to stage the first recovery among leading economies. Key metrics such as real estate sold, coal used in power stations and traffic congestion are all on the increase, suggesting at least a measured recuperation in demand. But the unpalatable reality is that China — and the world — find themselves in very different positions today than they did in 2008. Beijing then led the world’s return to growth by pushing out a massive $590bn stimulus package that was equivalent to 13 per cent of its 2008 GDP. By contrast, the US and Japan pumped a comparatively modest $152bn and $100bn into their larger domestic markets.

Those hoping for a repeat performance may well be disappointed. The simple truth is that China has run up so much debt in the credit-fuelled 12 years since the financial crisis that it can ill-afford another “big bazooka”. Nor does it appear as willing as it was in 2008 to identify the world’s problems as its own. Total bank assets in China have risen by 4.5 times since 2008 to $41.8tn at the end of 2019 — equivalent to about half of global GDP, according to the Rhodium Group, a consultancy. By contrast, Chinese GDP has increased by three times over the same period — meaning that much of China’s stellar decade of growth has been borrowed rather than bought.