"This article starts by taking a closer look at the general characteristics of China’s digital economy. Some of its strengths and weaknesses are further illustrated by two relevant case studies. First, we show that China is a front runner in the digitalisation of financial services (digital payment systems, new forms of credit) and the development of its central bank digital currency. Conversely, in a second case study, we find that China has been much less successful at mastering the cutting-edge technologies needed to produce the most advanced semiconductors, leaving China dependent on foreign suppliers of such critical technologies. In the second part of the article, we look at China’s unique policy approach towards fostering innovation-driven economic growth and president Xi Jinping’s vision for the digital economy. The third and final part gives an overview of the most important policy actions undertaken by the US and the EU in response to China’s rise as a digital power." (Introduction)