Purpose: China has become an economic powerhouse in historic terms but there are a number of challenges to its continued prosperity. The aim of this paper is to more fully understand China’s propensity for creative innovation, which is seen as an important next stage in its continued development. Design/methodology/approach: The paper is conceptual but uses historical and secondary data to support its assumptions. The paper was written in conjunction with the 1st Global Peter F. Drucker Forum (celebrating 100 years since his birth) and attempts to continue his challenge of “the hard work of thinking”. Findings: China has a long history of successful innovation. However, Confucian belief, a single despot and a closing off to the rest of the world have thwarted its innovative edge. The key to rekindling the entrepreneurial spirit is seen largely as an internal battle based on the state’s ability to balance the institution of government with the needs of a burgeoning prospective creative class. This paper identifies that much of this change will rely on quality-related developments rather than simply investments of financial capital. Originality/value: The ability to create new things is a challenge to developing economies that rely on low cost and imitation. China’s success in innovation will have substantial implications for developed nations both economically and geo-politically. China wants to be a significant player on a global scale and this paper sheds light on its potential to achieve such an objective. Through traversing China’s innovative landscape, this paper also enlightens the field of management on key aspects of China’s innovative past, present and future.