It's not all sovereign debt. The amount of debt owed by Chinese companies has also been exploding over the last few years. It's possible they're taking out al

It's not all sovereign debt. The amount of debt owed by Chinese companies has also been exploding over the last few years. It's possible they're taking out all that debt to make productive investments, but the analyses I've seen suggest that there's way too much debt for that to be the case. Now maybe the argument is that in a crisis this would all become sovereign debt (i.e. the government would bail the companies out and assume their debts). But that has its own issues, including the need for higher taxation to service the debt.