The 2008-09 international economic downturn, which China weathered more successfully than many other nations, has boosted the country's self-confidence on the international stage. China has adopted a more forceful stance on a range of issues, such as global warming, Taiwan, Tibet, exchange-rate policies and global liquidity levels. China's greater assertiveness means that further confrontation is likely in 2011-15. The country's clashes with its neighbours will encourage them to look more often to the US for political support. China will be a crucial participant in global negotiations, but it is highly sensitive to perceived slights, interference in its internal affairs and what it views as efforts to curb its rise. This, coupled with the weak influence within China of the Ministry of Foreign Affairs, will complicate attempts to improve international relations.

China's claim on Taiwan will remain a crucial foreign policy issue for the government. But military escalation of the dispute looks unlikely, as economic ties with Taiwan have deepened and China has adopted a less aggressive posture towards the island. Even if pro-independence forces take power in Taiwan, the status quo looks set to endure. China's ties with Japan will remain problematic, owing to lingering tensions over the Japanese occupation of China during the second world war and disputes over maritime territory. However, both governments will try to improve relations in the longer term. China's expanding international interests have been highlighted by increased activity in fields such as peacekeeping and anti-piracy patrols. This trend is likely to continue, but the greatest source of the country's influence on the global stage will come from the desire of foreign governments and companies to tap China's vast market and to attract Chinese investment.