Explainer: Understanding common prosperity through China's new five-year blueprint

by Xinhua writers Cao Peixian, Yu Xiaohua, Xu Lingui

BEIJING, Feb. 27 (Xinhua) -- Over the past months, widening income gaps and strains on social security in some of the world's most developed capitalist countries have become a heated topic of discussion in China and beyond.

Against this backdrop, attention has increasingly turned to how socialist China is grappling with similar pressures through its pursuit of "common prosperity." This approach seeks to address unbalanced and inadequate development, expand the middle-income group and broaden access to basic public services across a population of 1.4 billion.

A clearer picture of China's next steps will emerge with the release of its 15th Five-Year Plan, which will be reviewed and voted on at the upcoming national legislature session in Beijing. The plan will chart the course of the world's second-largest economy from 2026 to 2030, a vital period in China's push to basically achieve socialist modernization by 2035.

Although the final text of the new plan still awaits approval, recommendations adopted by the Communist Party of China (CPC) leadership last October have set its tone.

The Recommendations of the CPC Central Committee for Formulating the 15th Five-Year Plan for National Economic and Social Development emphasize the need to "make solid progress" toward realizing common prosperity for all.

This reflects the Party's long-standing people-centered development philosophy, one that places human well-being -- rather than the maximization of capital returns -- at the core of modernization. In this sense, common prosperity is presented as a defining feature that sets Chinese modernization apart from Western development models.

Contrary to some Western portrayals, common prosperity is not egalitarianism nor a redistribution-first model that suppresses market incentives. It follows a dual-track strategy -- expanding the economic "pie" while improving its distribution, so that growth gains are shared more broadly.

Since reform and opening up began in the late 1970s, China has advanced common prosperity by allowing some regions and groups with the potential to prosper step forward first and encouraging them to pull others up behind them.

Far from dampening economic momentum, this approach has delivered parallel gains in both growth and inclusion. China has remained the world's second-largest economy for more than a decade and developed the largest middle-income group, while overall living standards have continued to rise.

A major milestone came in 2021, when the country declared the eradication of absolute poverty. The 14th Five-Year Plan period (2021-2025) that followed has therefore centered on consolidating and expanding poverty alleviation gains while advancing rural revitalization, making solid strides toward the goal of common prosperity.

Looking ahead, China's new five-year blueprint envisions further expanding the middle-income group, reinforcing a broader and more resilient foundation for inclusive growth.

POLICY STEPS FOR THE NEXT PHASE

Employment will play a prominent role in China's common prosperity strategy, as it is the linchpin of economic growth, income distribution and social mobility.

The 15th Five-Year Plan will place "high-quality, full employment" front and center in efforts to improve livelihoods, highlighting not just the creation of jobs but a system capable of supporting the development of vocational skills for all age groups.

These measures will be paired with efforts to shape an "oval-shaped" income distribution.

Market mechanisms will continue to reward work, skill and innovation, while redistribution is strengthened through taxation, social security, and transfer payments. Personal incomes are supposed to rise in step with overall growth between 2026 and 2030.

Education, healthcare and elderly care will feature prominently in the new plan, part of a broader recalibration of investment toward human capital alongside traditional spending on physical assets.

In many countries, services such as education, healthcare and elderly care are treated less as public goods and more as market commodities, often exacerbating social inequality. China seeks to keep a stronger public role in these sectors, aiming to address disparities before they harden into lasting structural divides.

Future policies in the forthcoming five-year plan point to longer compulsory education, improved higher education, and expanded access to lifelong learning. Public services are set to penetrate deeper into communities, expand across rural areas, and tilt toward remote regions and financially disadvantaged populations. Social security nets are expected to provide a stronger safety cushion for vulnerable groups such as children and people with disabilities.

The new plan is expected to emphasize broader access to government-subsidized housing and safe, comfortable, green and smart homes, giving people not just a roof over their heads, but the environment to live well, grow and thrive.

For China, the road to common prosperity runs up against a formidable challenge -- bridging development gaps across a vast and diverse country of 1.4 billion people, a scale and complexity rarely seen elsewhere.

This challenge is most acute in China's rural areas, home to roughly 450 million people, where policymakers have long warned that a hollowed-out countryside could derail the goal of broadly shared prosperity.

The past five-year plan cycle delivered measurable gains in rural revitalization, as rural incomes had outpaced those in urban areas. Building on that momentum, the upcoming 15th Five-Year Plan aims to accelerate agricultural modernization, upgrade rural infrastructure and further boost farmers' earnings.

More coordinated regional development will also remain a priority, with provinces encouraged to build on their own comparative strengths. Wealthier regions are poised to take the lead, while closer interregional ties aim to ensure that growth momentum spreads more broadly across the country.

China already operates the world's largest education system, healthcare network, and social security framework, alongside an extensive system of urban housing support. Yet as the economy evolves, new developments -- from demographic shifts to emerging industries and changing social expectations -- require continually adapted policies. Past achievements show that, through successive five-year plans, China can meet these challenges and make steady progress toward the goal of common prosperity.

This is how China is pursuing a shared human ambition, beyond the trajectories of Western welfare states and expansionist development strategies.

Viewed without ideological labels, it appears not as a theory but as a living experiment in aligning prosperity with fairness and growth with opportunity -- a contemporary exploration of equitable modernization. ■