Since the turn of the century, China has gradually taken on new roles in the international community. With the support of a fast growing economy, China has not only developed into a regional power with expanded roles in Central and Southeast Asia, the country also shows aspirations to become a great power through increased military capacity and actions that seek to induce systematic change in the world. While traditional power provides the mainstay for China’s rise, Chinese political elites have also taken notice of the fact that culture is the key to greatness. Employing Joseph Nye’s concept of "smart power," this article examines the case of China’s global cultural policy in recent years and describes how Beijing attempts to utilize Chinese culture to complement hard power strategy and achieve its interests in the world. Specifically, the author will focus on the Confucius Institute and how the institute serves as a tool for exporting Chinese thought and culture and shaping China’s international image.