true health of the chinese economy, this sentiment of china not being in crisis was also borne out in discussions at the recent the imf / world bank annual meetings in lima, peru. the asian development bank also noted a number of reasons to remain optimistic despite the slowing growth outlook, notably a growing services sector and resilient consumption amongst others. deutsche bank, in a recent article 3 notes that a “ hard landing ” scenario in china is not on the cards and interpret recent evidence as pointing to, at worst, a gradual decline in growth such as has been evident over the past couple of years. deutsche bank argues that while china ’ s credit / gdp ratio is rising, the inherent advantages of a current account surplus, high net foreign assets ( 13 per cent of gdp ) and low external debt burden ( about 10 per cent of gdp ) offer a significant counterweight to the risks of a crisis posed by a high credit / gdp ratio. therefore, it is unlikely that there would be a „ sudden stop [UNK] of international capital, such as the kind that in the past has triggered crises. in addition, it is argued that china doesn ’ t need to import capital to sustain credit growth, neither are banks in china likely to voluntarily suspend financing to borrowers. what does this all mean for africa? the current low level of commodity prices has had a significant impact on some commodity exporters. if we take oil as an example, nigeria as an oil exporter has seen a dramatic slowing in growth to 2. 4 per cent in the second quarter of 2015 from 6. 5 per cent a year earlier. the oil market accounts for more than 90 per cent of foreign exchange earnings and about 70 per cent of government revenues in nigeria. the central bank has spent reserves and more recently implemented capital controls to defend the currency. it is also worth noting that the imf has significantly revised downwards the sub - saharan africa growth outlook for 2016, from 5. 1 per cent in july, to 4. 3 per cent in the october 2015 world economic outlook. http : / / www. brookings. edu / blogs / order - from - chaos / posts / 2015 / 09 / 21 - chinese - currency - devaluation - dollar global economic perspectives, a hard landing in china? deutsche bank, 5 october 2015. bis central bankers ’ speeches while china is africa ’ s largest trading partner, it does not follow that because china slows, that it is all doom and gloom for africa. we should

at the same time, the average coupon on outstanding corporate bonds remains considerably above rates on new debt issues, suggesting that firms are well positioned to cut their debt service burdens still further as outstanding bonds mature or are called. the net effect of these trends to date has been a decline in the ratio of business interest payments to net cash flow, a significant increase in the average maturity of liabilities, and a rise in the ratio of current assets to current liabilities. with business balance sheets having been strengthened and with investors notably more receptive to risk, the overall climate in credit markets has become more hospitable in recent months. specifically, improvements in forward - looking measures of default risk, a decline in actual defaults, and a moderation in the pace of debt - rating downgrades have prompted a marked narrowing of credit spreads and credit default swap premiums. that change in sentiment has extended even to the speculative - grade bond market, where issuance has revived considerably, even by lower - tier issuers that would have been hard - pressed to tap the capital markets over much of the last few years. banks, for their part, remain well - capitalized and willing lenders. in the past, such reductions in private yields and in the cost of capital faced by firms have been associated with rising capital spending. but as yet there is little evidence that the more accommodative financial environment has materially improved the willingness of top executives to increase capital investment. corporate executives and boards of directors are seemingly unclear, in the wake of the recent intense focus on corporate behavior, about how an increase in risk - taking on their part would be viewed by shareholders and regulators. as a result, business leaders have been quite circumspect about embarking on major new investment projects. moreover, still - ample capacity in some sectors and lingering uncertainty about the strength of prospective final sales have added to the reluctance to expand capital outlays. but should firms begin to perceive that the pickup in demand is durable, they doubtless would be more inclined to increase hiring and production, replenish depleted inventories, and bring new capital on line. these actions in turn would tend to further boost incomes and output. tentative signs suggest that this favorable dynamic may be beginning to take hold. industrial production, as i indicated earlier, seems to have stabilized, and various regional and national business surveys point to a recent firming in new orders. indeed, the backlog of unfilled