The Chinese leadership recently adopted a "strategy of strengthening China through human capital" with the goal of enhancing the country's international competitiveness in higher education. Largely because of new policy incentives implemented by the government, China has witnessed a tidal wave of foreign-educated Chinese returning to their native country since 2000. A quarter-century-long effort to train China's best and brightest overseas now seems to have come to fruition. These new developments, however, may also intensify political tensions between coastal and inland regions within the country and between foreign-educated and locally educated elites. China's well-funded universities, where foreign-educated returnees already predominate, are disproportionately located in a few coastal cities. This increasingly uneven distribution of human capital presents a major challenge for the Chinese leadership as it strives to achieve more-balanced regional development.