The global economic picture isn't pretty, and China's woes may soon make it even less pretty, says Ruchir Sharma, head of emerging markets and global macro at Morgan Stanley Investment Management.

"Over the past 50 years there has been a global recession once every eight years, on average, so the next one may be brewing," he writes in The Wall Street Journal.

"The policy panic in Beijing over its currency and the fall of its stock market suggest that the next global recession likely will be 'made in China.'"

The Shanghai Stock Index has dropped 23 percent since June 12, and the yuan has slid 3 percent since China's government devalued it last week. The economy officially grew 7 percent in the second quarter, but analysts say the true figure is closer to 3-5 percent

The U.S. economy used to be the prime cause of global recessions. But since 2010, China has accounted for one-third of global growth, compared to 17 percent for the U.S., Sharma explains.

"The world is one shock away from recession," he writes. "A debt-laden China is now the critical link, and another one- or two-percentage point decline in its growth rate could provide that shock."

As for the yuan, many experts view China's devaluation as a signal that the global currency war rages on.

"When people start talking about 'currency wars,' it's never a good thing," Michael Farr, president of esteemed money-management firm Farr, Miller & Washington, told USA Today.

"China's move to devalue its currency could be the first shot across the bow toward a wider currency war."

A weaker currency helps a nation's economy by boosting its exports, as the falling currency makes the exports cheaper in foreign currency terms. But if many countries try to devalue at once, the effect is nullified.

"A currency war is really a race to the bottom, whereby one country after another devalues their currency to gain an export price advantage, creating too much supply and not enough demand, which elevates the risks of even more anti-growth protectionist measures," Joe Quinlan, an investment strategist at U.S. Trust, told USA Today.

"Currency wars are anti-growth and deflationary."

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