The stockpiles of timber are growing in Dalingshan, home to China’s ersatz furniture trade. Vast workshops make fake antiques for export to US homes but demand has slumped and profits at Samson, a Taiwanese company, fell by a third in the first half. The challenge for such companies is to switch their focus to the domestic market, but that is easier said than done. The Chinese are savers, not spenders, distribution is lacking and the country’s vast hinterland is cut off from the global consumer economy. If we needed further evidence that the Chinese economy is on the rack over its dependence on the West, it is the colossal stimulus package announced yesterday in Beijing.

The spending binge on infrastructure is a belated attempt to kickstart consumption and ward off an export manufacturing collapse. Wishful thinkers who touted the notion that China was somehow decoupled from the West were ignoring the telltale signs of pain in the slowing of the trans-Pacific container trade and the sputtering Chinese plants.

Economists disagree on the extent to which the Chinese economy depends on selling us cheap toys, electronics and furniture. Headline statistics suggest as much as 40 per cent of China’s GDP is export-driven but some argue that in terms of value-added the export economy is much smaller because so much of China’s exports are assembled from imported components. Others point out that America only takes a fifth of China’s exports but a further 30 per cent is sold to other emerging economies, which in turn depend on America’s motor.

The argument over numbers fails to address the potential political crisis over rising unemployment as workers flee the Guangdong and Shanghai sweatshops and return to poor villages. There is also the impact of a Chinese manufacturing slump on the world.

China’s workshops suck in huge volumes of raw materials as well as components and high-tech machinery, which are then spewed out into the world economy. China’s economic link to the West is not a coupling; it is a terrible embrace.

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