Many analysts continue to tout China as the great investment opportunity of the new century. Yet, the long-term sustainability of its economic expansion remains uncertain. Can China’s explosive growth survive its corrupt and inefficient political system?

The economic record is, without question, impressive. Foreign direct investment levels jumped again in 2004 to a record $64bn. Between 1978, when its market-based economic reforms began, and the end of 2004, China has raked in an estimated $563.8bn – about 10 times the amount Japan has amassed since 1945. Wall Street analysts remain bullish on the People’s Republic, largely because these analysts tend to project growth rates for China’s next generation based on the performance of the last.