As two Chinese warships (and one support ship) enter the Gulf of Aden, the Chinese navy returns to an area it has not visited for six hundred years.
Taiwan is lifting its ban on its military and government officials freely travelling to China. Meanwhile, China has announced that it believes Taiwan will voluntarily rejoin China as the economies of the two nations become more linked. This may take a few decades, but this is considered preferable to war.
The current world-wide economic recession actually began at the end of 2007, and in the first six months of 2008, nearly 70,000 factories shut down in China. Most of these supplied the export market, and orders from U.S. firms had suddenly shrank. For each of the last three months, manufacturing activity has declined. The Chinese economy is still growing, but at half it's normal (about ten percent a year) rate. However, millions were now unemployed. By the end of 2008, there were, each week, hundreds of major demonstrations by unemployed or underpaid workers in cities and towns throughout China. The government fears that the unemployment violence could attract many more people who are unhappy with the corruption in the ruling Communist Party, and government officials in general. Police in violence prone areas are on high alert, and army units are being prepared for riot duty.
China does not expect the current recession to interfere with its military build up.
December 31, 2008: In the United States, two Chinese men were arrested for illegally exporting thermal imaging technology to China.
December 30, 2008: This month, China again began blocking Internet news sites that it had unblocked during the August Olympics. The blocked sites discuss Chinese politics, and touch on such forbidden subjects as relations with Taiwan and Tiber independence. In addition, the government is now forcing all Internet search providers to block access to pornography. This makes the government very unpopular with many of the 255 million Chinese Internet users.
December 24, 2008: China has arrested 59 people in Tibet for "spreading rumors" and trying to organize more pro-independence (for Tibet) demonstrations. The independence movement has no weapons, but will get violent, especially against ethnic-Chinese migrants, who are becoming the majority in parts of Tibetan cities and towns.
December 23, 2008: UN investigators were unable to prove that ammunition flown into Zimbabwe were of Chinese origin.
December 19, 2008: After noting that foreign warships were defending Chinese merchant ships, and Chinese crews, off the Somali coast, China announced it was sending two frigates and a supply ship to join the international anti-piracy patrol in the Gulf of Aden.