Key question asked over financial firepower

However, in the United States, there is little or no room to adjust rates after the Federal Reserve cut them to near-zero on March 15. Four days later, the Bank of England cuts its base rate from 0.25 percent to 0.1 percent. The European Central Bank's main deposit rate is already in negative territory.

In terms of fiscal policy, China is less indebted than many of the world's leading economies. According to the International Monetary Fund's World Economic Outlook data in October, the country's central government debt to GDP ratio was 60.9 percent, compared to the US' 108 percent, Italy's 133.7 percent, France's 99.2 percent and the United Kingdom's 84.8 percent. The figure for Japan, the world's most indebted country, was 237.6 percent.

Sun Mingchun, chief economist at Haitong International Securities, a securities company and investment bank based in Hong Kong, believes China has many advantages over other economies when it comes to lifting itself out of this crisis.

"On the fiscal side, the Chinese government has a lower debt to GDP ratio than most Western countries, even considering its local government debt," Sun said.

"On the monetary side, there is sufficient room to cut both interest rates and the reserve requirement ratio further. The transmission mechanism of monetary policy to the real economy has also proved more effective in China than in Western countries, at least over the past two decades."