

Central planning with private ownership of capital. The economy is dominated by private enterprise that employs workers for a wage and collect profits from the surplus value created by workers, but politics are in command instead of the anarchy of markets.
Ultimately it’s a strategic step towards achieving socialism; a developmental stage that allows the centrally planned economy to attract foreign investment and implement rapid development until it’s not needed. China, for example, is replacing more and more of its private sector with fully/majority publicly owned companies. I believe a majority of China’s economy is now public, not private. If the trend continues, most private ownership will whither away.
Was it necessary? I don’t think so - this is just how history happened to unfold.
Another source from PIIE in January of this year has the private sector declining from 55 percent in mid-2021 to 33 percent in late-2024, with a small uptick back to 34% at the end of the year. Public sector ownership over that same time period went from 31 percent to 51 percent.