China’s ratio of private non-financial debt-to-GDP has now breached 200% – a quarter above what it was in the US ahead of the financial crisis in 2008.  If all off-balance sheet lending were to be included, the total would be substantially higher. Credit continues to flow towards unprofitable projects and unproductive assets that generate little or no return. Fathom estimates China’s non-performing loans problem at close to 30% of GDP, over ten times higher than the official estimate. We struggle to believe that President Xi will be willing to sacrifice lower growth for deleveraging: if and when growth falls below