First year (Mandarin) Chinese student here.
First, a correction of a slight misconception : it’s not that the “meaning of spoken words depends on the tone in which it’s pronounced”, not really. Rather, a given syllable can be pronounced 4 different ways (well, five really) and it is that **combination **of sound+tone that forms a syllable or word. To us ghost-people who don’t use tonal languages it seems like it would be a source of confusion, but to a Chinese (or Vietnamese, or Korean etc…) person “mă” and “mà” are as different and unique as, I dunno, A and B are to us. They’re just not the same sound.
Things are complicated a bit by the fact that there typically are multiple characters that can be used for each of these sound+tone combinations ; and in turn each of those individual characters usually means different, sometimes completely unrelated things. Also while each character is a word (in the “unit of meaning” sense of the word), a word can also be composed of multiple characters/syllables. You’re supposed to figure out the meaning of what is said by context, and when that doesn’t work you ask the speaker “which character(s) do you mean by [phonetic] ?”, at which point they will trace it in the air or on a piece of paper which narrows the exact meaning down.
In practice it’s less complicated, or at least less ambiguous, than I think I’m making it sound :).
Back to your question, which is one I actually asked my teacher this year : Whoever coins the neologism basically gets to pick which characters they want to use for the purpose. After that, either it catches on and it becomes a “real” word, or it doesn’t : same as any other language.
New unique *characters *are very rare these days - they’ve already got more of *those *to work with than they know what to do with 
If the neologism is e.g. a new concept or object for which there is no Chinese word yet, that concept can be deconstructed to its operative principles - characters or words for which typically already exist in Chinese - and a new word is coined using those characters. For example, a Chinese word for computer is Diànnăo, which could be translated literally as “electric brain”. In other cases the choice seems more “abritrary” : for example the USA is Měiguó or “the pretty country” ; England is Yīngguó, “the flower country” (or, now that I think about it, could simply be derived from the English word itself since “Eng” and Yīng are pretty close) ; while France is Fǎguó, “the country of laws”. Japan is Rìběn, “Where the Sun comes from”.
When the neologism is a loanword, then whoever wants to use it in writing gets to pick a set of characters that, regardless of their individual meaning, would be pronounced the same way. For example McDonald’s is rendered in Chinese as Màidānɡláo, which taken literally would mean something like “Wheat equal to fatigue/hard work” - purely nonsensical. But it sounds the same, or at least is sounds like how the Chinese hear & pronounce the word “McDonald’s”. Pizza is Bǐsà, and so on.
In other words in that case the new word is “spelled out” phonetically.
Quote:
In English, if you see a new word you can sound out its pronunciation based on the letters. And you can look up an unknown word in the dictionary to find out its meaning. But these possibilities don’t exist in a logographic language.
Of course they do.
Pinyin (the official system for writing Chinese using the Roman alphabet, which I’ve been using here all along instead of copy/pasting characters) helps there because you can e.g. type “mai” in a search engine and get returned every character that exists to encode mai, mài, măi, māi and mái along with their meaning. And of course paper pinyin dictionaries can be ordered alphabetically.
But if you run into a character or set of characters the meaning of which you don’t know, you can still look *those *up in a dictionary directly - they obviously can’t use an alphabetic order in that case but characters can still be typified and classified - by number, order and type of brush strokes ; by sub-parts of the character and so forth.
As for “how do you know how to pronounce a character you’ve never encountered” : you just don’t, and have to look that up. But 98%+ of modern Chinese words only make use of ~3,000 unique characters so it’s pretty easy to learn all of those by rote (he said ironically) !
; but they’re both still basically speaking English.