In this Special Report, Barry Naughton of the University of California, San Diego, details the “unprecedented” challenges facing the Chinese economy in 2008. Steven Dunaway of the International Monetary Fund outlines a reform prescription for “rebalancing” the Chinese economy, while Jeffrey Logan of the Congressional Research Service notes the direct relationship between China’s industrial policy, its energy needs, and its environmental woes. Cong Cao of the State University of New York describes China’s aspirations to be a world leader in science and technology by 2020, thereby making a crucial contribution to China’s sustained economic growth.