China is claiming that their warships escorting Taiwanese merchant ships off the Somali coast, to keep the pirates away, is another sign that Taiwan accepts that it is part of China. Taiwan has protested that this is not so, but cannot send warships to Somalia, because all the ports in the region belong to nations which have been bribed or intimidated by China to refuse entry of Taiwanese warships. Even the "Taiwanese" merchant ships travelling through the area do not fly under the Taiwanese flag (which is common, Liberia and Panama are the preferred flags of convenience).
China is spending $7.5 billion to turn its three main (government owned) media giants, CCTV, Xinhua and the Peoples Daily, into major international news outlets. There will be more English language print and broadcast news, as well as more uncensored news. Thus the recent censoring of the new American presidents inauguration speech (to delete critical comments about communism and countries that jail critics of the government) inside China, would not occur in overseas broadcasts, in order to give the impression that China does not censor domestic content. The expanded foreign news operation would employ more foreign correspondents, providing the intelligence services with operatives in more (over a hundred) countries. The expanded news effort would make it easier for China to counter negative news stories about the Chinese government.
Last year, China passed Germany to become the third largest economy on the planet (after the U.S. and Japan). Currently, the U.S. has a GDP of $13.8 trillion, Japan $4.4 trillion and China, $3.5 trillion. The per-capita share of that GDP varies greatly, since the U.S. has 302 million population, China 1,300 million and Japan 127 million. Thus the average Japanese generates more than ten times the GDP as the average Chinese. But 30 years of constant, nearly ten percent a year, economic growth have turned China into an economic superpower, at least in terms of national GDP. The problem is that there are two Chinas. About twenty percent of the population are enjoying most of this growth. They mainly live along the coast, where a recent survey found, to no one's surprise, that 80 percent of the coastal waters were polluted by several decades of sharp economic and industrial growth. But the interior is poor, and angry. In other words, you've got about 300 million people doing quite well, and another billion that are not happy with the situation at all. The current recession has already cost over ten million Chinese their jobs, and that may double this year. This may become worse as the newly elected U.S. government has announced an effort to stop China from manipulating the value of its currency to put American firms at a disadvantage. China denies the charges, but won't prove it.
Growing unrest (demonstrations and riots) over official corruption has caused the government to increase efforts to halt the stealing by, and bribery of, government officials. Last year, for example, overseas travel by government officials (a favorite way to spend, or move, bribes and stolen money) was curbed by nearly 20 percent (although over a million officials managed to take trips). Thousands of suspect officials were forbidden to go abroad at all. But all the publicized anti-corruption efforts are not slowing down the rot. There are still dozens of major demonstrations against corruption every week. None get publicized in the government media, and reporters in general are cautioned to stay away from stories about official misconduct, or else. But the news gets around via Internet and cell phone texting, despite growing government efforts to censor such messages.
Defense spending is increasing to over $60 billion a year. A regional satellite navigation system (like GPS), called BaiDou ("Compass") will be expanded, in the next six years, to cover the entire planet, and upgraded to compete with the U.S. GPS system. This will cost over $10 billion.
North Korea, apparently at the urging of China, has demanded a ban on nuclear weapons for the entire Korean peninsula. China wants this, as South Korea could easily build nukes, and thus become a more powerful regional rival.