How much should we worry about a slump in China?

The recent turbulence in equity markets has highlighted how vulnerable global investor sentiment is to developments in China, but the risks to the world economy are smaller than many assume. Although China’s growth has slowed sharply in recent years, we do not expect a “hard landing”. What’s more, even if we turn out to be wrong, some emerging economies would be hit hard by a slump in China, but the impact on advanced economies should generally be modest.