Abstract: China as the world’s largest trading partner has developed its own form of capitalist political economy. China’s state capitalism is already global in reach and poses a challenge to other forms of capitalism, for example, the anglo-American capitalist system or continental capitalism (Rhine or Rhenan capitalism, practiced on continental Europe). This form of state capitalism is quite different from its Western version and is characterized by a reliance on informal business networks, guidance from the state and socialist and imperial influences. It is a system in which the Chinese government uses capitalism and free markets to advance their own power and interests. Is Chinese state capitalism a new economic paradigm or a rejuvenation of old policies under a new consensus? With a new president elected in 2012, how has China benefitted from capitalism under the tenure of Hu Jintao? Will a revival of Marxism alleviate economic and social imbalances and lift the masses out of poverty into the capitalist overdrive. What is the history of Chinese capitalism in the region and how does it influence good neighbor relations? The aim is to provide answers to these questions which also constitute the theme of the study.