With the handover of Hong Kong and Macau, China's 'one country, two systems' plan shifted up a gear. Jiang Zemin's leadership charted a new course based on economic growth; overseeing the admission of China into the World Trade Organisation and guiding Beijing to success in the 2008 Olympics bid. His successor, Hu Jintao is set to follow the path of economic modernisation more aggressively still. Continued civil rights abuses, official corruption and the stagnant rural economy are the sharpest thorns in the country's side, but membership of the World Trade Organisation was a great leap forward - though probably not one Chairman Mao would have envisaged.

The biggest barrier to the 'One China' model is the tiny rogue island of Taiwan, which has agreed in principle to the model but paradoxically interprets it in its idiosyncratic, Taiwanese way. China has retorted with rhetoric about 'brothers and sisters' and, just to prove that all families have their problems, have backed it up with a show of military muscle. It's the equivalent of a Chinese burn administered by an older and stronger brother.

China's economy continues to expand at an astounding rate and with such growth comes the increased demand for energy (12% of the globe's and growing), pressure on the environment and widening gap between the flourishing south and east-coast provinces and the less developed inland areas. Beijing has attempted to deal with these issues; opening the massive Three Gorges Dam hydro-electric scheme in 2006 and launching a Develop the West campaign to lure investment into the hinterland. Rural China has seen an upsurge in protests and demonstrations, often targeted at corrupt officials. The government retains a tight grip on the nation's media, building the so-called 'Great Firewall of China' to filter the internet. As the Beijing Olympics approach, China's less than commendable human rights record, typified by its treatment of Falun Gong members and its pursuit of trade and political links with international pariahs such as Myanmar and North Korea are both coming under international scrutiny.