China is big. It has the biggest population in the world, the biggest ambitions – and, it becomes clear within moments of arriving at Beijing international airport, possibly the biggest building. Norman Foster's glittering glass and steel structure, poised, like a crouching crystal dragon between the air and the vast country around, is colossal. It's 1.3 million square metres, larger than 200 football pitches.
Once into the centre of Beijing, the signs of the new China are everywhere. The hotel itself – the super-posh 525-room Peninsula Beijing – is bordered by smart little shops with smart little mannequins all wearing smart little dresses. The signs say it all. Chanel. Gucci. Dior. Through the revolving doors there's more: two more floors, in fact, below the reception, and the cocktail bar, and next to the restaurant serving exquisite Cantonese cuisine. Here, you can sleep in luxury, watch flat-screen telly in the bath, wallow in the gorgeous, newly renovated spa or shop till you drop.
This is, indeed, the new China – the place where the new Chanel concession quickly became the highest grossing in the world, where they simply can't get enough of designer labels. This is the China where paintings by Zhang Xiaogang and Liu Xiaodong get snapped up, for two or three million pounds, not just by foreigners, but by Chinese entrepreneurs keen to make a killing. The Chinese understand that you can make a market out of anything, and that art is as much a vehicle of capitalism as of creative expression.
When I arrive, it's pouring, but by the time I've roused myself from a brief jetlagged stupor, the rain has stopped. For the next four days, there's blue sky, sun – and no wisp of the famous Beijing smog. Within a couple of minutes of stepping out past the Chanel black dresses, and then the foot massage shop, the restaurants and the serviced apartments, I'm in Wangfujing Road, Beijing's Oxford Street. Here, amid the silk shops and the pharmacies selling dried seahorses and knobbly roots alongside the paracetamol and the penicillin, there are the familiar signs: McDonald's, KFC, Nine West, Morgan, Rolex. Other shops bear the proud slogan 'Official supplier of Olympic goods' and, everywhere, the mantra 'One world, one dream'.
But I'm not here to shop, however, but for art. I want to see how the country of calligraphy, carved dragons and watercolours became the country of multimillion-pound cartoons and postmodern Maos. So, I start with the old. It takes me about quarter of an hour to walk to the Forbidden City, the secret palace enclave commissioned by an emperor in 1406, opened up to tourists in 1925 and to the world by Bertolucci's sumptuous extravaganza The Last Emperor. On the way, I meet an artist called I Zhoubin. He started painting, he tells me, when he was ten and studied in Xian. Now he paints by night and sells his work – contemporary colourful riffs on a traditional rural watercolour theme – together with other people's copies of work by major modern Chinese artists, in this tiny shop in the old quarter. He dreams of moving into a little flat. At 30, he lives in a dormitory in a distant suburb.
At the Forbidden City, I am not the only tourist. Giant groups of Chinese in red baseball caps are being herded around by people yelling into megaphones. The young are all in jeans and the older ones are in dark trousers and near-identical patterned jackets. Luckily, there is plenty of space for us all, because the Forbidden City, like Bejing airport, like the Great Wall of China, and like China itself, is gargantuan. It's also phenomenal. After a while, you get blasé about the giant palaces, usually a Hall of Supreme Harmony, or of Complete Harmony, or of Preserving Harmony, often destroyed in the Ming dynasty and restored in the Qing dynasty, and all with spectacular carved ceilings and massive carved thrones. But it's only in the smaller palaces on the edge of this secret city that the history really comes alive: in an exhibition on the 'lifestyles of empresses and concubines', the gowns, the pictures and the tiny, sinister shoes, and in some photos of Pu Yi, the last emperor. Seeing the fading, sepia photos of this frightened little boy on a throne and at his wedding, I'm reminded that it was less than a century ago, this world of semi-divine splendour and semi-divine powers. Looking at the smiling people now, treading where only concubines and eunuchs could tread before, it's extremely hard to believe.