Agreed. China is famous for having a large state sector (though in terms of share of total employment,
it is shrinking and has fallen below that of the US, Germany, and France). However, despite that and the CCP's pretentions of running "Socialism with Chinese Characteristics," this form of state capitalism is among the most cutthroat in the world. It looks more like the industrial policy of Japan and South Korea during their growth years than anything Marx would've considered "socialist." The social safety net is small, the job market is extremely competitive, rents in top-tier cities like Shanghai are among the highest in the world, etc etc.
So although Sweden is not socialist in the traditional definition, it does have a less unequal society than China and its social democratic economy is more aligned with the intents of most left-wingers, so Sweden is the correct answer here.
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