Xi Jinping has pledged to double the size of China’s economy by 2035, but can he rein in inequality?
- China’s rapid growth over the past four decades has lifted living standards, but coincided with a widening wealth gap
- President Xi Jinping says China must address the issue more seriously, indicating renewed focus over the next 15 years
China will need to reform tax, welfare and labour policies if it is to reign in inequality and create “common prosperity” for all by 2035, economists say.
In outlining his 15-year vision for China, Xi said the country “must achieve substantial progress towards common prosperity in a more noticeable way”, indicating renewed focus on addressing the country’s wealth gap in coming years.
Former leader Deng Xiaoping said the goal of Chinese socialism was to achieve common prosperity for all, although it remains a distant vision.
It’s very difficult to achieve the ultimate goal of common prosperity, but at least China is determined to make more visible progress,
China’s rapid growth in the past four decades has lifted living standards across the country – pulling tens of millions of people out of poverty – but it has also coincided with a sharp widening of inequality.
“It’s very difficult to achieve the ultimate goal of common prosperity, but at least China is determined to make more visible progress,” Li Xunlei, chief economist of brokerage firm Zhongtai Securities, wrote in a note published on Friday.
Li said China would need to enlarge the number of middle-income earners and expand basic social service coverage to narrow the gap in living standards.
Analysts agree Xi will face an uphill battle to rein in inequality, which widened under the watch of his predecessors as China transformed from a dirt poor, predominantly rural country to the world’s second largest economy.