It’s time to turn our gaze towards the East, to peer over the Great Wall and take a gander at China.

Do you remember when they used to say the world had decoupled. That the US could sneeze, and the rest of the world could carry on growing.

Well, in the last few months decoupling has looked more and more like myth. And yet, not entirely. China has continued to enjoy breakneck expansion.

But now there are signs that even China is feeling the heat.

November saw a 2.1 per cent decline in exports, the first monthly fall since 2001. Fan Jianping, chief economist at China’s State Information Centre recently forecast Chinese growth would slow to between 8 and 9 per cent in 2009. This compares with an 11.9 per cent growth rate in 2007.

To be fair, an 8 per cent growth rate is still pretty impressive. But such is the scale of poverty in China, and the desire for Chinese peasants to emigrate to the cities, that the economy needs pretty extreme growth just to ensure needs are being met. In fact, China needs to grow rapidly just to stave off unemployment. That may seem bizarre, but as productivity rises, economic growth must rise too. The sum is simple. Say labour becomes 10 per cent more productive. Then output must grow by 10 per cent too, just for the jobs stats to stay still.

But in a key Chinese region, things are not so good. In Guangdong, that is the region which is next door to Hong Kong, there is talk that growth could turn negative. Bearing in mind the region expanded by 14.7 per cent in 2007 and by 10.1 per cent in 2008, that would be a dramatic change indeed. Incidentally, according to China Daily, the economy overtook Singapore in 1998 and Hong Kong in 2003, and is now worth around one-eighth of the entire Chinese economy. So, the region really is key for China.

As for China as a whole, Capital Economics now reckons growth has fallen from 12.6 per cent in Q2 of 2007, to 9 per cent in Q3 last year, to 6 per cent in Q4. It is warning that Chinese growth this year could be just 5 per cent.

But, in a way, China’s problem is the world’s problem.

Saving levels have been far too high in China, consumption too low. China has been too reliant on the rest of the world. Its exports are too important.

The money flowing from China into the US went a long way, of course, to funding the credit boom. On a global scale, for most of this decade the problem was not too much debt, it was too much saving, as China, Japan, Germany and some OPEC countries sold more than they bought.

China has the answer to its own problem. It needs to empower consumers. It needs to encourage greater spending. It needs to let the yuan rise, thus making foreign goods cheaper, meaning its consumers will feel better off.

Such moves from China won’t only help kick start its own growth, they will go some way to restoring global imbalances.

If only Germany could do the same. If a Chinese consumer led boom was combined with some Teutonic exuberance, then we would be taking a big step closer towards solving the underlying causes of the economic crisis.