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China's economic growth since 1978 has transformed the country. People are richer, freer, and healthier than they have ever been, and if current growth rates are sustained, poverty will be eliminated in China by 2025. But China's economic growth has also created its own challenges. And Beijing's growing military power threatens to put it on a collision course with the United States. Dwight Perkins looks at the major obstacles that Beijing must yet surmount if it is to emerge as a rich country in the twenty-first century and considers the steps that China must take to succeed.