Enter the dragon: China's computer industry

China transformed its economy by shifting from technological nationalism to a more pragmatic strategy of developing national capabilities in conjunction with multinational corporations. Consistent with this transformation, China has revamped its industrial and technology policies to become a major producer of computer hardware and a major market for computing products. In 2000, mainland Chinese purchased more than seven million PCs, while computer hardware production grew to $23 billion. China's policies clearly drew on the developmental approach of other Asia-Pacific countries that became leaders in the global computer industry through the strong support of government industrial and technology policies. China has likewise become a major force in the global PC industry, as both the most attractive growth market and as a large producer. New challenges loom as China joins the World Trade Organization and faces more pressure to open its market to foreign competition. The paper considers the regional and national environment.