This is a city built for a million people - but no one lives here: The Mongolian metropolis thrust into the 21st Century in a storm of steel and concrete

Modern China is like a great freight train storming up a long, steep slope with no summit in sight, all its locomotives straining. It cannot slow or stop. The brakes would never hold. If it pauses for a second, it will start to roll back towards disaster. The whole world would be shaken by the crash that followed.

So there is no joy in asking if China has outgrown its strength after ten years of blazing, enthralling growth. But it may have done so. The hedge-fund managers, those canny vultures of finance, are beginning to circle slowly, high overhead. They are starting to bet on the bursting of the Chinese bubble. These people did not become very rich indeed by guessing wrong.

And one of the reasons for their gloomy guesswork is here, in the strange, wistful landscape of Inner Mongolia, birthplace and home of Genghis Khan.

Power and vainglory: Peter Hitchens stands beneath the bronze horses in Genhis Khan Square in the empire city of Kangbashi

The journey here is full of the thrill and muscle of the new China. With its colossal proven coal reserves of 170 billion tons (about one sixth of China's entire coal reserve and enough to keep a normal country going for centuries), the Great Khan's land, once famous only for marauding armies and destruction, has become important in a new way.

As you get closer to its heart, you see many of the famous new coal-fired power stations that China is building at a rate of two a week. You see forests of shiny new electricity pylons. You see the enormous white concrete stilts of new motorways and express railways, penetrating what until now has been a lonely steppe of soft red earth, deep ravines and prehistoric hamlets of cave-like homes.

You also see the mountain ranges of newly mined coal that are being loaded into the incessant, unbelievably long, low, black trains that trundle in all directions, in cheerful mockery of the West's footling green campaigns.

As my train rolled into Dong Sheng, the main station for the Ordos urban area, a Chinese fellow traveller who had often visited Ordos in the past (and had promised to let me know when we arrived) failed to realise that this was our destination - because he no longer recognised the place. So many new buildings had gone up since he had last been there that until he saw the station sign he didn't know we had arrived.

Someone has obviously decided that Inner Mongolia is to be thrust into the 21st Century in a storm of steel and concrete. This will need people, who have previously been fairly rare in the violent climate and never-resting winds. And so they have built a great new city to draw them in. What would happen if nobody came to live in it? We may soon find out.

A cleaner works in in front of one hundred bronze horse bronze near the artificial river in Kangbashi district of the Chinese city of Ordos, Inner Mongolia

Seen from space, Kangbashi is a metropolis fit to hold a million busy, prosperous people, with sweeping boulevards, a spacious central square, homes, factories and offices spread over 12 square miles and a wide river running through it.

In its publicity, Kangbashi is a super-modern megalomaniac's dream. There is a sculpture park containing dozens of abstract figures in faintly obscene embraces, standing for the unity of the people and the Chinese armed forces.

The whims of modern architects have been indulged, with a drum-shaped concert hall that looks much like a sawn-off cooling tower, and a leaning library built to resemble a shelf of books - next to a sort of giant cowpat coated in reflective bronze, perhaps symbolising Inner Mongolia's dairy industry.

Seen from the new expressway which leads to it, it is a majestic line of towers in the haze. But at ground level there is something severely wrong. Traffic is slowed because a huge advertising hoarding has fallen from a bridge on to the carriageway. Like so much of modern China, sparkling at a distance, grubby and cracked close to, the reality does not quite live up to the appearance.

There is far worse to come. One approach road leads past what was until recently a 30,000-seater stadium, costing £100 million and rushed to completion in nine months for last year's Mongolian Games - horse-racing, archery and wrestling. When it was opened, it looked rather like Concorde about to take off. But soon after New Year's Day, a whole white wing, plus the central peak, collapsed during the night.

'Like so much of modern China, sparkling at a distance, grubby and cracked close to, the reality does not quite live up to the appearance'

Thank Heaven, there was nobody in it at the time. The road to the ruin is closed but it is possible to hurry by and see the colossal wreck, the tangled steel now cleared away but the missing sections not yet rebuilt.

It is not wise to look too interested, as we shall see. Officials have, of course, denied that the collapse was the result of the hurry to finish in time for the Games.

They blame welding defects and the harsh weather (which was not exactly a surprise in this blizzard-blasted part of the world).

Peking is intensely sensitive about such so-called 'Tofu Projects' - hurried and grandiose building schemes, which can and do kill.

Artist and dissident Ai Weiwei has been 'disappeared' by this sinister police state, partly because he made it his business to investigate and expose the corrupt skimping of work, the sub-standard reinforcement and poor-quality materials that led to the deaths of thousands of schoolchildren when their classrooms were shaken into rubble by the 2008 earthquake, which measured eight on the Richter scale, in Sichuan. Japanese schools withstood a far greater earthquake this year.

In 2007 the new 360-yard Tuojiang Bridge in Hunan fell apart as workers removed its scaffolding.

These are just the ones we have heard about. Who knows how many other disasters or near-disasters have gone unrecorded?

This is anything but a free country. A Chinese journalist who tried to take photographs of the wreckage outside Kangbashi, was detained and 'asked' to hand over his pictures. As far as I can find out, there are no surviving photographs of the scene immediately after the building fell. Orders from on high saw to that.

For it is from on high that instructions came to encourage local business to invest in this place, which previously contained two insignificant villages with about 1,500 people in them. And it is from on high that the will and force come, which have created a city out of nothing on the empty steppe.

This was the deal, binding Communist Party, state, military and businessmen. The local government would build the roads, the schools and the infrastructure. The investors would bring the car factory (now working), the business headquarters and the rest. The police and the army would occupy major buildings.

Together, they planned to spend £1.7 billion on the theory that, if you build it, they will come. Wealthy Chinese would buy the apartments and the place would soon fill with people.

Not so far. In the middle of the afternoon, it is possible to get killed by the typically callous Chinese traffic, but only if you make a major effort to do so. Traffic is so thin on Genghis Khan Square that a pedestrian can hope to cross the 50-yard wide boulevard without waiting for the lights, provided he keeps his wits about him. This is not the case in any other Chinese city I have ever visited.

Under construction: Properties in Kangbashi district take shape as Inner Mongolia undergoes a rapid 21st century industrialisation

Past the monstrous sculpture of Genghis Khan and his friends stand two great rearing sculpted horses (Mongolia's national symbol, though the real thing is quite rare here). A notice on the more-or-less bare earth beneath them orders citizens to keep off the non-existent grass, and when I ignore this instruction, an official (apparently posted for this purpose) spots me from about a quarter of a mile away and starts shouting angrily. He must have to wait hours for each opportunity to do this, as visitors are almost as sparse as the precious grass.

Between the horses is a far vista of unfinished blocks of flats, staring out over the landscaped riverbank and a large ornamental park dedicated to Genghis Khan's mother, and presided over by a 50ft statue of this no doubt impressive lady.

Rough justice: The ghostly, unfinished court building in Hohhut, complete with crumbling steps and stone lions

All the glassless windows and raw concrete (plus the extravagant monuments and the feeling that everyone has gone away) remind me strongly of the North Korean capital of Pyongyang, which is brooded over by the stupendous unfinished Ryugyong Hotel. This is another place where ambition far outstrips reality.

Many of the hundreds of building sites are wholly silent, or are barely active, with one or two workers visible among the cranes and hoists. But there are advantages to being a pioneer in such a place, as well as drawbacks.

Among customers in a small grocery shop, where the prices of fruit and meat are startling high, there is only praise for the high quality of the teaching at the Number One High School.

This is a prestige project, a fenced off campus the size of a small university with dining hall, gymnasium and, unusually, large blocks for weekly boarders - children from Dong Sheng 15 miles away, who have been moved here to inject life and youth into what would otherwise be a near-empty building.

The excellent teachers have been lured here with extra-high salaries, so the children get a better education in return for being away from home for much of the year. The place is plainly still less than halffull, the staff car park almost empty, the pupils' bicycle racks not much fuller.

Others complain about speculators who are said to be buying up the apartments in the hope that one day the city will boom, so making them more expensive than they need to be.

One man purchasing meat says that the city's population has doubled in the past year - but nobody is sure what the true figure might be. Some say it is as high as 150,000, but judging by the light traffic, the many darkened windows at night and the small number of cars parked outside new housing in the evening, I would be surprised if it was anything like that large.

Yet who knows? It might work. The first supermarkets are starting to open. Spacious buses cruise the avenues, in contrast to most of China where public transport is a sweaty and claustrophobic squeeze.

Follow the yellow brick road: A new path through Genghis Khan Square

There is always somewhere to park. There are cheap restaurants - and costlier ones. The main hotel is already hosting elaborate wedding parties. But this activity may be largely artificial, as the police and several mysterious parts of the People's Liberation Army have set up large offices here (presumably on government orders) and so give the place an air of being busier than it truly is.

The previous day I had seen a vision of what might happen if Kangbashi fails. The new city of Quingshuihe, near Clearwater River, is far smaller than the giant Kangbashi.

And it is certainly needed, as the old town is a horrible, cramped dump of miserable concrete blocks huddled around roads that barely deserve their name, petering out quickly into mud and potholes.

It is so wretched that it is officially classified as impoverished, and is in many ways more like Africa than modern urban China. Yet this is only two hours' bumpy drive from the provincial capital of Hohhot, with its grandiose city centre and plentiful neon and concrete.

But here, unlike in Kangbashi, the new town is almost completely untenanted (apart from the police and a few municipal officials).

The rise of China, a crude police state inherited from communist rule by greedy, corrupt cynics who appear to believe in nothing, was a shocking break with all that we had known

On one side of a road as wide as a runway, down which a powerful wind sweeps dust and litter, are what might have been meant to be a hotel, and what might have been meant to be flats - both of them utterly abandoned with a concrete mixer fallen from its stand and lying like a dead Martian in the rubble-heaped front yard.

Some way from the rest of the aborted, futile township is an entire courthouse, surrounded by scrub and rough earth, its flagpoles empty, its crumbling steps adorned with stylised stone lions and its top storeys adorned with the (slightly uneven looking) scales of Chinese justice. But ghostliest and bleakest of all is an unused prison, watchtowers and all, waiting for convicts whose crimes will never be committed - because the place where they would have happened has never had any people in it.

When I first saw the new Shanghai more than seven years ago I was alarmed by the explosive power I saw - but even more by what it meant. The rise of China, a crude police state inherited from communist rule by greedy, corrupt cynics who appear to believe in nothing, was a shocking break with all that we had known.

It meant that the link between liberty and prosperity, which we had assumed throughout the Cold War was unbreakable, was gone. From now on, the world could get rich without being free.

Later I would see much more of China's majesty, power and squalor - the cruel treatment of the poor who wish to defy the one-child policy; the dismal sweatshops that produce so much of what we buy, all unaware of the sad places where it is made; the horrible massacre of unborn baby girls in this fiercely male-dominated culture; the filthy pollution that goes unchecked; the bullying and suppression of minority peoples by increasingly nationalist Chinese; the cynical corruption and greed of China's colonial enterprise in Africa; the crude destruction of historical treasures that do not suit the regime - and all of this against a background of apparently unstoppable energy and hard work, of freemarket economics made visible.

Did I wish it well or ill? I was never sure, and China does not much care what we think of her anyway.

But we have to care about China whether we want to or not. The United States is hopelessly in debt to her. The world economy is largely kept moving by her. If the hedge-fund vultures are right, the great Chinese train is about to slide back down the slope it has climbed.

Its credit levels are said to be unsustainable. It produces far more steel and far more cement than it can use - amazing statistics given its hunger for both. House prices are far too high.

Banks, like ours, have lent money against land that is unlikely to hold its value. With millions of properties empty, it continues to build more.

I am forced to hope that there is no Chinese bubble, that the frantic growth will continue, that the steel and the cement are sold and used, that the properties are occupied, that Kangbashi flourishes.