The experience is that the build-up of financial risks like those seen in China is almost always followed by a marked slowdown in GDP growth or a financial crisis. It is important to point out that these outcomes are not inevitable and that China is able to learn from the experience of other countries, including Australia.
Even so, it is understandable that concerns have been raised. One of these concerns is that during the big run-up in debt, a lot of bad loans were made. Assessing the extent of this issue is made more complicated by the particular nature of the Chinese financial system.