S&P's downgrade of US debt has thrown into question the safety of its Treasuries as investments. So far the consensus seems to be that they are as safe as ever - especially with a lack of other havens in which to store money. However, between the downgrade and debt problems in Europe, concerns have been raised over government debt elsewhere. China, for its part, says its own Treasures are secure investments because of its comparatively small scale.

Experts say that because China limits the amount of government bonds it sells to the public, its debt-to-GDP ratio is lower and thus, risk is better controlled. Currently, its outstanding debt is less than seven trillion yuan, while the country's 2010 GDP has exceeded 40-trillion yuan.

Bai Jingming, deputy director from Research Institute for Fiscal Science, MOF said, "China's outstanding debt only accounts for less than 20 percent of the country's GDP. Meanwhile in the U.S., the figure is close to 100 percent."

Bai said another way to look at the issue would be calculating the ratio of government deficit to GDP - that is, the amount it spends each year in relation to the revenue it generates. According to the EU's Maastricht Treaty criteria, that annual figure must not exceed 3 percent. In China, this year, the figure will not go beyond 2.5 percent.

Bai said, "Our deficit is comparatively small, its ratio to GDP has not passed the alert level. In our 2011 budget, the government deficit will be cut by 100 billion yuan from 2010."

Bai adds that the Chinese government's fiscal revenue has grown at a rate of 20 percent - a factor that also underlines the security of Chinese treasuries.

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