Live news: China’s Xi defends ‘common prosperity’ reforms in online Davos speech

China’s “common prosperity” drive is not a pursuit of egalitarianism, President Xi Jinping said in a rare international defence of the policy that last year rattled markets from Hong Kong to New York.

Xi, whom many perceive as China’s most powerful leader since Mao, was speaking via video link at the World Economic Forum’s annual meeting — held online this year, rather than at the Swiss alpine resort Davos.

“The common prosperity we desire is not egalitarianism,” Xi said. “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.”

Under the policy, spearheaded by Xi, the Chinese Communist party has been reshaping the country’s business and cultural landscape via a months-long series of crackdowns. This has targeted industries including fintech, education and entertainment as well as perceived societal ills such as celebrity culture, gaming and effeminate fashion trends.

The moves, which have wiped billions of dollars from Chinese and foreign investors, have sparked international debate over the political and economic motives of the policy, and made the future of investing in China uncertain.

Xi attempted to ease some concerns, insisting to the Davos audience that China remained committed to open to foreign business.

“All types of capital are welcome to operate in China, in compliance with laws and regulations and play a positive role for the development of a country.”

The speech comes as China faces criticism for the erosion of democratic freedoms in Hong Kong and the treatment of Uyghurs in Xinjiang as well as expansive military posturing. In response, Beijing regularly rebukes the US and its allies and partners for interfering in China’s domestic interests.

The Chinese president warned of “serious negative spillovers” if “major economies slam on the brakes or take a U-turn in monetary policies” as the world grapples with accelerating inflation.

Problems with industrial supply chains, tight energy supplies and rising commodity prices posed challenges, he cautioned. “These risks compound one another and heighten the uncertainty about economic recovery,” he said.