Xi Jinping has declared China’s “common prosperity” agenda, which has seen a government crackdown on wealthy firms, is not about pursuing egalitarianism.
The Chinese President also called for a change to the current “Cold War mentality” in light of the growing conflict between China and the US.
Beijing’s common prosperity drive is aimed at narrowing the yawning gap between the country’s richest and poorest through increased state control of the economy.
It has included crackdowns on tech giants and wealthy individuals over the past 15 months, such as when the government refused to allow Alibaba to list on the Shanghai and Hong Kong stock exchanges in what would have been the world’s largest initial public offering.
The policy has rocked markets and led to more than $1 trillion in market value from China-listed firms to be wiped out entirely, according to America’s Brookings Institute.
Speaking at the virtual World Economic Forum today, Xi said: “The common prosperity we desire is not egalitarianism
“We will first make the pie bigger and then divide it properly through reasonable institutional arrangements. As a rising tide lifts all boats, everyone will get a fair share from development and development gains will benefit all our people in a more substantial and equitable way.”
Some China watchers have claimed the drive is an attempt by Xi to stop any potential social upheaval from its 750m-person workforce.
The President also said “we need to discard Cold War mentality and seek peaceful co-existence and win-win outcomes”.
It comes after relations between the US and China have become increasingly frosty, with the status of Taiwan a particular flashpoint.
China has been increasing its rhetoric over reunifying with Taiwan, with many fearing this could lead to an invasion of the island in light of increasing threats and intimidation from Beijing.
This could lead to a war between the US and China if Washington decided to get involved.
“History has proved time and again that confrontation does not solve problems,” Xi said.
“It only invites catastrophic consequences. Protectionism and unilateralism can protect no one. They ultimately hurt the interests of others as well as one’s own.”