Joan Johnson-Freese, a space expert at the Asia-Pacific Center for Security Studies in Hawaii, noted that the Long March rocket used to launch the spacecraft, which orbited the earth 14 times, was not the same as rockets used commercially.
"It's purely prestige,'' she said.
"Their technology is very crude and very spartan in some ways,'' said Johnson-Freese, author of six books on space. "If you want to put a precision satellite in orbit, no, China is not where you go.''
In Hong Kong, shares of electronics maker China Aerospace International Holdings Ltd. were buoyed on Monday by the launch. The listed firm's parent, China Aerospace Corp, launches commercial satellites in China.
China Thumbs Its Nose at U.S. Critics
China's success came 42 years after the former Soviet Union became the first nation to go into space.
But it made China only the third nation in history to launch a vehicle capable of carrying a man into space after the former Soviet Union and the United States.
Analysts said the display of domestic expertise also allowed China to thumb its nose at U.S. critics who accuse it of stealing U.S. space technology.
"It enables China to say again: 'You claim we had stolen your technology. I don't think so.
Look at what we can do on our own','' Johnson-Freese said.
In May, a U.S. congressional report by Representative Christopher Cox, a California Republican, alleged Chinese agents stole U.S. space, missile and nuclear secrets.
China, which has vehemently denied the Cox report, says both the rocket and the spacecraft used in the launch were homegrown.
A Hong Kong-based defense analyst said more resources now would be spent on the space program, which would potentially benefit the Chinese military.
Any significant improvements in terms of more accurate space launches or heavier payloads would also benefit strategic missile development in the long term, said the analyst who asked not to be identified.
Nationalistic Value, Boon To Jiang
Domestically, the launch is a boost to national pride and the standing of President Jiang, analysts said.
"It's a unifying factor, a pride factor for the Chinese people,'' Johnson-Freese said. "But this does not change any of the strategic equation.''
Jiang has identified himself personally with the project by naming the craft "Shenzhou," or "Divine Ship." That name, in Jiang's calligraphy, appeared on the front pages of major Chinese newspapers on Monday.
Analysts said China could carry out a piloted flight within a year, but that two to four years was more realistic. The timing would be driven by economics.
"There is still a large technological leap to be made between having an unpiloted vehicle that is capable and piloted launch capability,'' Johnson-Freese said.
China has said it will conduct more unpiloted test flights before putting cosmonauts in space.
"Economic development is China's number one goal and the space program is a cash cow right now," Johnson-Freese said. "It's a question of money.''
Robert Park, a physicist at University of Maryland, welcomed China's space program.
"I don't see it as bad news at all," Park said.
"Human space flight has no military implications at all, except to demonstrate that they have advanced missile capability, but we knew that already."
"As long as they're doing that, they're not fooling around with things that are more dangerous. Human space flight's relatively harmless. I would be delighted to have them spending their money that way," he said.