China's debt domino effect: Is the world economy at risk?

China's debt domino effect: Is the world economy at risk?

Friday, 29 September 2023

Funcas Europe

Hello Future is blue readers,

Welcome to our newsletter about European economic affairs bringing together top experts from academia and think tanks to discuss the most pressing economic challenges of today. Future is Blue is promoted by Funcas.

China's debt has been rising dramatically over the past decade. Some are arguing that this represents a risk for its own stability and that, ultimately, considering China's size, a bursting of the debt bubble could trigger a new episode of global financial stress.

Our new podcast episode that we are releasing todayexplores the reasons why China's debt seem to be getting out of control and to what extent there is a real risk of entering into global financial turmoil. 

Don't miss today's new content with top expert Alicia Garcia Herrero, Chief Economist for Asia Pacific at Natixis, a French multinational financial services firm, and Senior Fellow at Bruegel think tank, Raymond Torres, Funcas Europe Director, and Carlos Carnicero Urabayen, Future is Blue host.

See also our weekly readings at the bottom of this newsletter.

New podcast episode available!

In today's Future is Blue podcast episode we cover the following about China's debt and the implications for the world economy:

  • What factors have contributed to the rapid growth of Chinese debt in recent years?
  • What measures have been taken so far by Chinese policymakers?
  • How is Chinese debt impacting China's domestic economy?
  • Is the China debt problem similar to what happened in the EU a few years ago?
  • What scenarios could trigger a global financial crisis?

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What we are reading

A quantitative evaluation of the European Commission’s fiscal governance proposal
This paper focuses on the fiscal adjustment that the first regulation would require of countries with debt above the treaty benchmarks.

The promise — and peril — of generative AI
This technology is readily accessible and usable at extraordinary speed and scale.

Jobs for the green transition
Definitions, classifications and emerging trends.

Why fear is spreading in financial markets
Investors have begun to confront the long-haul reality of high interest rates

Have a nice rest of the week.

Raymond Torres
Funcas Europe Director


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