While the PRC is regarded as a communist state by many political scientists, it is also the wealthiest of those that remain. But attempts to characterize the nature of China's political structure into a single, simple category are typically seen as lacking sufficient depth to be satisfactory. A major reason for this is that for much of China's history, the state had been ruled by some form of centralized imperial monarchy, which was followed by a chaotic succession of largely authoritarian Chinese Nationalist governments as well as warlord-held administrations since the last few years of the Qing Dynasty in 1912. Although the PRC government has been variously described as authoritarian, communist, and socialist, it appears China is slowly becoming capitalist in its economic system. However, heavy restrictions remain in some areas, most notably on the internet and in the press.

The country is mainly run by the Communist Party of China (CPC), but there are other political parties in the PRC, called "democratic parties", which participate in the People's Political Consultative Conference but mostly serve to endorse CPC policies. While there have been some moves toward political liberalization, in that open contested elections are now held at the village and town levels, and that legislatures have shown some assertiveness from time to time, the party retains effective control over governmental appointments. This is because, in the absence of meaningful opposition, the CPC wins by default in most electorates. The CPC has been enforcing its rule by clamping down on political dissidents while simultaneously attempting to reduce dissent by improving the economy and allowing public expression of personal grievances so long as they are not organized. Current political concerns in China include lessening the growing gap between rich and poor, and fighting corruption within the government leadership. The support that the Communist Party of China has among the Chinese population in general is unclear because there are no consistently contested national elections. Also, private conversations and anecdotal information often reveal conflicting views. However, according to a survey conducted in Hong Kong, where a relatively high level of freedom is enjoyed, the current CPC leaders have received substantial votes of support when residents were asked to rank their favourite Chinese leaders from the mainland and Taiwan.

The PRC maintains diplomatic relations with most countries in the world. In 1971, the PRC replaced the Republic of China as the sole representative for "China" in the United Nations and as one of the five permanent members of the United Nations Security Council. It is considered a founding member of the UN, though the PRC was not in control of China at the time. (See China and the United Nations). The PRC was also a former member and leader of the Non-Aligned Movement.

Under the One-China policy, the PRC has made it a precondition to establishing diplomatic relations that the other country acknowledges its claim to Taiwan and sever any official ties with the Republic of China (ROC) government. The government actively opposes foreign travels by former and present Taiwanese officials, such as Lee Teng-hui and Chen Shui-bian, and other politically controversial figures, such as Tenzin Gyatso, the current Dalai Lama of Tibet.

China has been playing an increasing role in calling for free trade areas and security pacts amongst its Asia-Pacific neighbors. In 2004, China proposed an entirely new East Asia Summit (EAS) framework as a forum for regional security issues that pointedly excluded the United States. The EAS, which includes ASEAN Plus Three, India, Australia and New Zealand, held its inaugural summit in 2005. China is also a founding member of the Shanghai Cooperation Organization (SCO), with Russia and the Central Asian republics.

Much of the current foreign policy is based on the concept of China's peaceful rise. However, conflicts with foreign countries have occurred at various times in its recent history, particularly with the United States; e.g., the U.S. bombing of the Chinese embassy in Belgrade during the Kosovo conflict in May 1999 and the U.S.-China spy plane incident in April 2001. Also, its foreign relations with many other Western nations suffered for a time following the Tiananmen Square Incident in 1989, sometimes referred to as the Tiananmen Square Massacre or June 4th Incident. The relationship between China and Japan has been strained at times by Japan's refusal to acknowledge its war-time past to the satisfaction of the PRC, e.g. revisionist comments made by prominent Japanese officials, and insufficient attention paid to the Nanjing Massacre and other atrocities committed during World War II in Japanese history textbooks. Another point of conflict between the two countries is the frequent visits by Japanese government officials to the Yasukuni Shrine, which enshrines thousands of World War II war criminals, including 14 Class A convicts. Relations with China and Japan also have been strained by the Anti-Japanese Riots that occurred in spring of 2005.

The PRC is in a number of international territorial disputes. China's territorial disputes have led to several localized wars in the last 50 years, including the occupation of Tibet in 1950, the Sino-Indian War in 1962, the Sino-Soviet border conflict in 1969 and the Sino-Vietnam War in 1979. In 2001, the PRC and Russia signed the Treaty of Good-Neighborliness and Friendly Cooperation, which paved the way in 2004 for Russia to transfer Yinlong Island as well as one half of Heixiazi Island to China, ending a long-standing Sino-Russian border dispute. Other territorial disputes include islands in the East and South China Seas, and undefined or disputed borders with India, Tajikstan and North Korea.

The PRC is the largest country in area in East Asia (excluding Russia) and the third largest in the world by land-and-sea area. (However, due to a recent change in the method used by the United States to calculate its surface area, some countries and international organisations list the United States as third largest.) It borders 14 nations (counted clockwise from south): Vietnam, Laos, Myanmar (Burma), India, Bhutan, Nepal, Pakistan, Afghanistan, Tajikistan, Kyrgyzstan, Kazakhstan, Russia, Mongolia and North Korea.

The territory of the PRC contains a large variety of landscapes. In the east, along the shores of the Yellow Sea and the East China Sea, there are extensive and densely populated alluvial plains, while on the edges of the Inner Mongolian plateau in the north, grasslands can be seen. Southern China is dominated by hill country and low mountain ranges. In the central-east are the deltas of China's two major rivers, the Huang He and Yangtze River (Chang Jiang). Other major rivers include the Xijiang River, Mekong, Brahmaputra and Amur.

To the west, major mountain ranges, notably the Himalayas with China's highest point Mount Everest, and high plateaus feature among the more arid landscapes such as the Taklamakan and the Gobi Desert.

A major issue is the continued expansion of deserts, particularly the Gobi Desert. Although barrier tree lines planted since the 1970s have reduced the frequency of sandstorms, prolonged drought and poor agricultural practices result in dust storms plaguing northern China each spring, which then spread to other parts of East Asia, including Taiwan, Korea and Japan. Dust from the northern plains has been tracked to the West Coast of the United States. Water, erosion, and pollution control have become important issues in China's relations with other countries.

China has some relevant environmental regulations: the 1979 Environmental Protection Law, which was largely modelled on U.S. legislation. But the environment continues to deteriorate. Twelve years after the law, only one Chinese city was making an effort to clean up its water discharges. This indicates that China is about 30 years behind the U.S. schedule of environmental regulation and 10 to 20 years behind Europe.

Water pollution has increased as an issue along with industrial production. The Chinese government has chosen a discharge standard measuring the concentration of a pollutant rather than the total pollutant load (as is done in the USA and many western countries). As a result many industrial dischargers in China simply dilute the effluent with river water taken from the same source as the receiving waters. Consequently the outcome has been to create considerable water pollution in many of the country's rivers.

With regard to carbon emissions, China was exempted from the Kyoto Protocol, and since that treaty was signed, China has become the world's number one emitter of carbon gases, adding to the threat of global warming.

Killing elephants for ivory has been a major cause of the decline of the African elephant population since at least the 1970s. Most of the ivory harvested is imported into the People's Republic of China and Thailand. For example, between 1996 and 2002 forty five tonnes of ivory in transit to China were seized by authorities. Quite recently China has agreed to reduce imports of ivory; however a Chinese official Chen Jianwei has indicated that many Chinese people are confused about the legality of ivory imports*.

Beginning in late 1978, the Chinese leadership has been reforming the economy from a Soviet-style centrally planned economy to a more market-oriented economy that is still within a rigid political framework under Party control. The reforms replaced collectivization with privatization of farmlands, increased the responsibility of local authorities and industry managers, allowed a wide variety of small-scale enterprises to flourish, and promoted foreign investment. Price controls were also relaxed. These changes resulted in mainland China's shift from a planned economy to a mixed economy. China became a member of the World Trade Organization in 2001.

The government emphasizes personal income and consumption by introducing new management systems to help increase productivity. The government also focuses on foreign trade as a major vehicle for economic growth, which led to 5 Special Economic Zones (SEZ: Shenzhen, Zhuhai, Shantou, Xiamen, Hainan Province) where investment laws are relaxed so as to attract foreign capital. Since the 1990s, SEZs and similar concepts have been expanded to other major Chinese cities, including Shanghai and Beijing. The result has been a 6-fold increase of GDP since 1978. Chinese economic development is among the fastest in the world, and has been growing at an average annual GDP rate of 9.4% for the past 25 years. At the end of 2005, the PRC became the fourth largest economy in the world by exchange rate, and the second largest in the world after the United States by purchasing power parity at US$8,158 trillion. But with its large population this still gives an average GDP per person of only an estimated US$7,200, about 1/6th that of the United States. However, China is expected to surpass the US in all areas of economy at the earliest in 2020, at the latest in 2050.

Mainland China has a reputation as being a low-cost manufacturer, which caused notable disputes in global markets. This is largely because Chinese corporations can produce many products far more cheaply than other parts of Asia or Latin America, and because expensive products produced in developed countries like the United States are in large part uncompetitive compared to European or Asian goods. Another factor is the unfavorable exchange rate between the Chinese yuan and the United States dollar to which it was pegged.

On July 21, 2005 the People's Bank of China announced that it would move to a floating peg, allowing its currency to move against the United States dollar by 0.3% a day, while 3% a day against other currencies. Many high-tech American companies have difficulty exporting to China due to US federal government restrictions, which exacerbated the trade gap between the PRC and the US, and perceived low quality of US goods. On the other hand, China runs a trade deficit with Taiwan and South Korea, importing more from those nations than exports. China runs a large but diminishing trade surplus with Japan. ^* (Slight deficit if Hong Kong is included). With the elimination of clothing quotas, China stands to take over a large chunk of the worldwide textile industry.

Preferential tax incentives are also given as a direct fiscal incentive to manufacture in China, whether for export or for the local market of 1.3 billion people. China is attempting to harmonize the system of taxes and duties it imposes on enterprises, domestic and foreign alike. As a result, preferential tax and duty policies that benefit exporters in special economic zones and coastal cities have been targeted for revision.

There is a large wealth disparity between the coastal regions and the remainder of the country. To counter this potentially destabilizing problem, the government has initiated the China Western Development strategy (2000), the Revitalize Northeast China initiative (2003), and the Rise of Central China policy (2004), which are all aimed at helping the interior of China to catch up.

After the Sino-Soviet split, China started to develop its own indigenous nuclear deterrent and delivery systems, successfully detonating its first surface nuclear test in 1964 at Lop Nor. A natural outgrowth of this was a satellite launching program, which culminated in 1970 with the launching of Dongfang Hong I, the first Chinese satellite. This made the PRC the fifth nation to independently launch a satellite. In 1992, the Shenzhou manned spaceflight program was authorized. After four tests, Shenzhou 5 was launched on October 15, 2003, using a Long March 2F rocket and carrying Chinese astronaut Yang Liwei, making the PRC the third country to put a human being into space through its own endeavors. With the successful completion of the second manned mission, Shenzhou 6 in October 2005, the country plans to build a Chinese Space Station in the near future and achieve a lunar landing in the next decade.

The Chinese government continues to place heavy emphasis on research and development by creating greater public awareness of innovation, and reforming financial and tax systems to promote growth in cutting-edge industries. President Hu Jintao in January 2006 called for China to make the transition from a manufacturing-based economy to an innovation-based one, and this year's National People's Congress has approved large increases in research funding. Controversial areas such as stem-cell research and gene therapy face minimal regulation in China.

China is also actively developing its software, semiconductor and energy industries, including renewable energies such as hydro, wind and solar power. In an effort to reduce pollution from coal-burning power plants, China has been pioneering the deployment of pebble bed nuclear reactors, which run cooler and safer, and have potential applications for the hydrogen economy.

The 863 Program is also part of China's science and technology focus. This program led to the development of the Godson computer processor.

Transportation in the mainland of the People's Republic of China has improved remarkably since the late 1990s as part of a government effort to link the entire nation through a series of expressways known as the National Trunk Highway System (NTHS). Between 2001 and 2005, more than 25,000 km (16,000 mi) of expressways were built in China for a total of 41,000 km (25,000 mi), second only to the United States.

Private car ownership is increasing at an annual rate of 15%, though it is still uncommon due to government policies that make car ownership expensive, such as taxes and toll roads.

Air travel has increased, but remains too expensive for most. Long distance transportation is still dominated by railways and charter bus systems. The railways are still the vital carrier in China, and until this year steam locomotives were still a common sight. It is thought that some are still in use, especially on industrial networks.

Cities such as Beijing and Shanghai are building subways or light rail systems. Hong Kong has one of the most developed transport systems in the world.
Shanghai already has a Maglev system connecting downtown Shanghai to Pudong International Airport