The consequence? A likely 1% to 2% decline in international trade in 2009 after several years of robust growth, including a 6% increase in international trade in 2008, Wang said, and a 2008 global recession -- a 2.2 to 2.4% world domestic product (WDP) growth rate in 2009 after a drop to 2.5% in 2008. The global economy grew at robust 5.0% and 4.8% rates in 2006 and 2007.

Clearly, the global economy will need a resumption of stronger economic growth in China to pull out of its recession, but it's not as simple as large fiscal stimulus increasing demand in China, Wang said. Like the U.S., China's economy has to implement structural changes: while the U.S. has to rebuild its infrastructure and manufacturing base, and increase domestic savings, China has to increase consumption relative to GDP, he said.

"These two economic giants are almost mirror images of each other. While the U.S. has to save, invest, and rebuild balance sheets, China has to increase consumer spending and develop internal sources of demand," Wang said. "China now knows the vulnerability of having export-dependent GDP growth. When those exports disappear, so does the growth. Both the size of China's middle class and the middle class's consumption rates have to increase."

On China's side, Wang said a key hurdle in the above will be convincing China's citizens to consume more: previous decades of deprivation and economic uncertainty have ingrained "a culture of saving and underconsumption, particularly among middle-aged citizens," he said. "That will have to change to get China's economy growing at a robust rate again."

Economic Analysis: Indeed, China's consumption will play a large role in how long the global recession lasts. The world is not going back to the model of "everyone exports and the U.S. consumes," hence the global economy will need consumers in China, India, Russia, Brazil, Japan, and in Europe to consumer more in order to create a sustainable global growth model.