This book is the third report on China prepared jointly by staff members of the Peterson Institute for International Economics and the Center for Strategic and International Studies. There is no better place to find a compact overview of recent developments in China, through mid-2008, both with respect to economic developments and with respect to China's foreign and national security policy. The book includes chapters on the complex relations between the central government and local governments, on the evolving role of the Chinese Communist Party, and on corruption. Its focus is China, but it is attentive throughout to the implications for the wider world and especially for the United States -- as well as to the actions the United States might take to solidify a constructive relationship between these two large countries (now first and third in the world in terms of economic output and population). The book contains an interesting discussion of the growing awareness among Chinese leaders of the importance of "soft power" -- China's influence on other governments and peoples through channels other than economic or military. But notably missing is a discussion of China's policies and actions with respect to human rights and the influence they might have on others.