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"China needs at least 2 trillion yuan (0.4 billion) of green investment annually over the next five years to promote environmental protection and reduce pollution," PBOC chief economist Ma Jun said in March.

"But there are smart policy options available that can soften these trade-offs, such as investing in testing and tracing capacity and durably expanding social protection to cover the poor and the informal sector."

"China has a high savings rate. It used to be a huge advantage, but we'll lose that advantage if borrowing grows faster than savings," he added.

"But there remains huge development space in China's financial sector. The country's faster pace in opening-up has offered those growth opportunities to global investors, providing a safe haven for investment and shoring up confidence," Bian said.

"Car sales will be further affected in the short term."