China’s ‘common prosperity’ goal to evenly distribute wealth as Xi Jinping sets out stall for development

President Xi Jinping chaired a meeting of the Communist Party’s Central Committee for Financial and Economic Affairs on Tuesday

Common prosperity is central to promoting well-being as China strives to achieve its second centenary goal of fully building a modern socialist country

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The speech by President Xi Jinping was delivered at a time when Beijing has mounted unprecedented crackdowns on various sectors within the economy, including technology, online education and real estate to tackle widening income inequality, rising debt levels and slowing consumption. Photo: AFP

Published: 12:59pm, 18 Aug 2021Updated: 11:58am, 23 Aug 2021

China must now gear towards a system that more fairly looks after those who are not yet wealthy after the early development of the national economy lifted the country out of poverty and created millionaires, President Xi Jinping said, laying out his plans by defining “common prosperity” for the first time.

At a key economic leadership meeting on Tuesday, Chinese leaders agreed China must pursue a goal of so-called common prosperity where people share in the opportunity to be wealthy as the main objective for the next stage of its development, while stressing the need for an airtight economy which allows for that smoothing out of wealth.

The thrust of the speech did not go as far as to suggest a Robin Hood-style rob from the rich to give to the poor plan, but called for better governance and more balance in the economy, focusing on grass roots consumption as a key economic multiplier rather than capital-intensive investments, which have been popular in past decades.

We can allow some people to get rich first and then guide and help others to get rich together

Xi Jinping

“We can allow some people to get rich first and then guide and help others to get rich together,” notes released by the Communist Party’s Central Committee for Financial and Economic Affairs meeting chaired by Xi said.

“We can support wealthy entrepreneurs who work hard, operate legally, and have taken risks to start businesses … but we must also do our best to establish a ‘scientific’ public policy system that allows for fairer income distribution.

“At the same time, [the government] should protect and improve livelihoods based on healthy economic development with a focus on strengthening a universal and inclusive security scheme.”

The timing of the speech drew interest among China-watchers both because it was made after Chinese leaders emerged from a two-week disappearance from public view allegedly to convene at the seaside retreat of Beidaihe and that it was formally discussed as a policy for the first time having been discussed loosely in the past.