Chinese President Xi Calls For Wealth Redistribution

Chinese President Xi Jinping is calling for wealth redistribution that includes a framework for “common prosperity,” curbing excessive incomes and working to avert financial risks, according to state media reports and other news outlets.

Xi made the remarks during the 10th meeting of the Central Committee for Financial and Economic Affairs. Aside from heading the committee, Xi is also general secretary of the Communist Party of China Central Committee and chairman of the Central Military Commission.

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Moderate wealth for all — common prosperity — was emphasized by Xi at the Tuesday (Aug. 17) meeting. He called for the need to “strengthen the regulation and adjustment of high income, protect legal income, reasonably adjust excessive income, and encourage high-income groups and enterprises to give back to society more,” according to a meeting summary published by state media Xinhua.

The meeting also included reports from ministries and commissions under the State Council, all involved in the push for common prosperity and averting financial risks, according to a statement released after the meeting, per state media. 

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Officials indicated that common prosperity would be introduced gradually and is not intended to be a method of equal distribution. They emphasized that common prosperity is “the prosperity of all the people, both materially and spiritually” per Xinhua. “It is neither for a small minority nor is it the pursuit of absolute egalitarianism.”

The notion of “common prosperity” has been used as a point of reference as Chinese watchdogs started cracking down on tech companies this year.

“Elaborating on the ‘common prosperity’ objective, China has affirmed its effort to rebalance the economy toward labor, tackling social inequality with redistribution, social welfare, taxes and inclusive education,” Morgan Stanley analysts said, per CNBC. 

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China has a population of 1.4 billion people and income inequality has been escalating, with the top 10 percent having 41 percent of the wealth in 2015, CNBC reported, citing estimates by Paris School of Economics professor Thomas Piketty in 2019. Comparatively, in 1978, the top 10 percent had 27 percent of the wealth.