This paper is adapted from essays written for the Britannica Book of the Year--1985. In it, the author reviews key political, economic, and foreign policy developments in China and Taiwan during 1984. In the case of China, he notes its effort to increase the role of market forces to stimulate urban economic development, and its commitment to a policy of promoting younger, technically skilled officials into positions of responsibility. In foreign policy, China achieved important successes with the United States but fared less well with the Soviet Union. It also concluded a historic agreement with Great Britain that will return Hong Kong to Chinese sovereignty in 1997. Taiwan enjoyed political and economic prosperity marked by a 10 percent growth in its economy, fueled largely by its extraordinary foreign trade performance. It has turned toward more advanced production technologies, and exports of electronics surpassed sales of textiles in 1984.