Watching the world diving championships or somesuch today, watching the Chinese clean up, it occured to me that the Chinese representatives never seem to repeat their accomplishments. Presumably, this relates to their hosting of the Olympics in 2008 - Chinese athletes don't have quite the freedom of their Western counterparts.
More likely, it's that China is carefully grooming athletes for 2008, allowing them one year on the international circuit to gain experience. In 2008, we could thus expect five or six years worth of top-drawer athletes to materialize under the home country's privilege and do quite a number on the medal count.
Wikipedia informs me that some 969 medals were handed out in 2004. Barring any new additions, and presuming that the number of ties is maintained, I'd take bets today on 200 Chinese medals.
At heart, this boils down to a demonstration of the power of authoritarian government and demographics. Chinese leaders aren't democratically elected, and are free to mobilize their country's economic resources towards points that will make an international splash if they so choose. Combine this with a much larger population base, and a wider pool of athletes to choose from, and you've got something going.
The logical interjection would be to argue the EU and US have vastly more money at their disposal. But it's a question of priorities. Such leaders have to deal with domestic issues, face peer criticism. The Chinese Politburo has no such constraints.
In all, if my expected Chinese medal count does materialize, it will simply be a testament to the power of authority to achieve grand gestures. I'm not advocating this as a good thing, however - and I suspect there are hundreds of millions of impoverished Chinese peasants who might agree with me.