Yet again I am attending the World Economic Forum in Davos, warning about the global inequality crisis – and proposing steps to tackle it. Yet again, Oxfam has released shocking new statistics which illustrate how severe this crisis has become: 62 people now have the same wealth as the poorest half of the planet – that’s 3.6 billion people.
I am not the only one raising the alarm: Consistently now, we hear concern on inequality from voices such as President Obama, the Pope, Christine Lagarde of the IMF, and people on the street. And things are starting to change. But not enough.
It’s not enough because the gap between the rich and poor has grown dramatically in the past 12 months. This time last year 80 people owned the same amount as the poorest half of the planet and Oxfam was predicting the wealth of richest one percent would overtake the rest of us by 2016 – this particular milestone was passed ahead of schedule in October.
The consequences of such rapidly growing and extreme inequality are huge. Economic inequality can act as brake on growth, slow poverty reduction efforts, and spark social unrest. Oxfam sees the devastating impact of extreme inequality in many of the countries where we work – from the school children of South Africa whose education is suffering because of lack of government funding, to the garment workers of Myanmar who work long exhausting hours for global suppliers but who can’t cover their rent and feed their families on what they earn.
This continued trend is hardly surprising: The inequality crisis is not a blip. It is hardwired into our economy. Oxfam’s recent report, An Economy for the 1%, explores how today’s global inequality crisis was born and raised on 30 years of unchecked deregulation, privatisation, financial secrecy and globalisation. Our economic system has enabled companies and individuals to use their power and influence to capture and retain an ever increasing share of the benefits of economic growth while the benefits for the poorest in society have shrunk.
Reversing this trend will take the determination of political leaders, and the active cooperation of business. It’s not hopeless, it’s just hard.
2015 saw some faltering steps forward. In September, the world agreed global goals in September on inequality and on eradicating extreme poverty. There was also a very welcome engagement from business. These commitments show governments’ intention to act. But these intentions need to be put into action. This requires addressing the drivers of inequality and challenging vested interests.
Top of that list of vested interests has to be tax havens. Serving no social purpose, these jurisdictions – characterised inter alia by high levels of secrecy and low or no tax rates – are fuelling the rise in inequality. As tax returns from wealthy companies and individuals disappear into this global network, governments are left with two options: to cut back on the essential spending needed to reduce inequality and deprivation; or to make up the shortfall by levying higher taxes on other less wealthy sections of society. Consequently, wealth is redistributed upwards, and the inequality gap grows.
Tax havens take billions from rich industrialised countries. But it is in the poorer countries that the impacts are felt most dramatically. Wealthy African’s use of tax havens cost African governments an estimated $14 billion in lost tax revenues in 2014. This is enough money to pay for healthcare for mothers and children that could save 4 million African children’s lives a year and employ enough teachers to get every African child into school. While UNCTAD is estimated that the use of tax havens by business costs developing countries around US$100 billion every year.
Some governments have recognised that tax dodging is a serious problem that needs addressing. In November G20 governments agreed steps to curb tax dodging by multinational companies. However these reforms largely ignore the problems posed by tax havens and do not do enough to ensure developing country governments can claim their fair share of taxes.
Now with tax havens becoming an ever more common way of doing business – 109 of the WEF’s 118 partners have a presence in at least one tax haven – it time we put a stop to this practice.
For the benefit of all their citizens, governments across the world need to commit to a second generation of tax reforms to end the race to the bottom on tax, and they need to end the secrecy around financial assets.
But this isn’t just about governments forcing companies to behave. I doubt many people, employees or employers, want a world of such vast inequities. Neither do they want the tax base on which their societies and economies rely to be undermined. So my message at Davos 2016 is for companies to think about how they can be tax responsible too – starting with a commitment to bring their money onshore.
In 2010, 388 people had the same wealth as half the world. Now it’s 62. When my research team told me this, I asked where this trend was taking us. Half-joking they continued the line on the graph they had plotted to 2020 where just 11 people occupied this exalted position. But I am not joking. This year I will fight inequality harder than ever on behalf of the world’s poorest people.
By Winnie Byanyima – Executive Director at Oxfam International
Today, I led hundreds of people from around the world in a walk out of the 19th UN climate talks. Oxfam has been keenly involved in the talks for a long time, fighting to help stop climate change, and to support people affected by it, and every day the urgency for governments to help gets greater. But year after year, the talks have been mostly just going through the motions – with very little progress on reducing emissions, or on raising the $100bn governments have promised to support people affected by climate change by 2020.
We have campaigned passionately and powerfully. Yet the public’s shouts of urgency for governments to act seem to be falling on deaf ears. This year, the talks have reached new lows: The hosting Polish government has colluded with the coal industry to present “clean coal” as a solution to climate change (it isn’t a solution). Australia has attacked the very principle of climate finance. Japan has even pledged to increase – not reduce – their emissions!
Enough is enough
This year, we have an unprecedented opportunity to reconnect with people worldwide, and to start building a truly powerful movement for climate action in Warsaw. The solidarity movement for the Philippines, Filipino delegate Yeb Sano’s fast, and all the people who joined him are strong, loud and important. The world is getting impatient.
Now is the time to show governments that we won’t accept their lack of political will. That people around the world demand action. And that world leaders can’t ignore climate change any longer. That’s why so many organizations and individuals have walked out: to go and gather the voices of the public and return stronger than ever in 2014. We’ll be back.
For more photos, follow this link.
By Mayling Chan – International Programme Director at Oxfam Hong Kong
In Hong Kong, like any modern city that tends to rely on globally sourced imported food, it’s hard to visualise the link between global issues of food insecurity and our own issues of food waste. The UN Food and Agriculture Organisation estimates consumer-based food waste in industrialised countries is almost as high as the total net food production of sub-Saharan Africa, that is, 230 million tonnes a year.
In fact, being able to control and reduce the volume of our food waste is a concrete way to contribute to global food security, which is characterised by the accessibility and availability of nutrition and food for all, through sustainable production, collection, distribution, marketing and equitable trade systems.
Having said that, modern cities have learned to be more self-sufficient in food provision over the past two decades. For example, farms have sprouted up in and around the city areas in Singapore, Havana, New York, Beijing, Caracas and elsewhere. Their purpose is to ensure greater adaptation to a world undergoing climatic changes that have affected production and crop yields.
Overconsumption of food seems to have become a daily habit for many. The people of Hong Kong produce more than 3,500 tonnes of food waste every day. On average we consume 1.12kg of food a day, yet in every three-person household, about 1kg of food will end up in a landfill.
It is encouraging to see that a handful of people in our city are trying to close the food waste loop. We consume locally produced food: local pork is sold in markets in Sha Tin and Tai Po, for example; farmed fish is enjoyed by tourists and locals alike; and locally grown vegetables are sold in agricultural markets that have sprung up in many districts, including commercial areas like Central and Taikoo Place.
This circular trend of local production and consumption supports the economy, which creates jobs. On top of this, it promotes a culture of resilience for our food and trade systems at all times, and a feeling of community, which celebrates the actions and culture to grow, rather than waste.
Few of us perhaps have a clear picture of how the people of Hong Kong can grow food, including raising small livestock. As of March 2012, there were 1,872 vegetable farms covering 415 hectares that were registered under a government scheme in Hong Kong. There are many more that have not registered that are scattered around on outlying islands, in food gardens and on the rooftops of many buildings across the city.
In Hong Kong, 4,600 people are directly involved in land-based agriculture and 11,000 in fisheries. The fact is that, due to a lack of support for a modern agricultural policy, overall production has fallen in the sector by some 24 per cent compared with a decade ago. This includes the raising of pigs, which has been marginalised; in 2011, the industry shrank to a fifth of what it was in 2001.
Researchers have recently looked at the potential for Hong Kong’s fisheries and livestock sectors to use feed processed from food waste, given that its production and distribution are subject to stringent health inspections and regulations. Take pigs as an example. It is estimated that there are 80,000 pigs being raised on Hong Kong farms. Every day, each pig consumes around 4kg of feed, or a total of 320 tonnes. By processing our food waste into pig feed, more than 2,100 tonnes could be put to good use, clearly demonstrating the market potential and value of food waste, pig feed and live pigs.
To encourage modest and sustainable consumption, Oxfam runs its Grow campaign all over the world. The purpose is to persuade policymakers to assist small farms and families by providing resources and helping them secure control over essentials like water and seeds to sustain a global network of food production.
Today, according to the International Fund for Agricultural Development, the world’s 500 million smallholder farms support around two billion people, almost one third of the total world population. However, many are among the world’s poorest people and, sadly, often go hungry. Thus, it is heartening to see that even impoverished countries like North Korea, where Oxfam Hong Kong works, has been able to grow more food in the past 10 years, closing its food gap by 60 per cent between 2002 and 2012, even with difficulties in obtaining sufficient fertilisers and fuel.
On annual World Food Day today, the UN estimates that 842 million people, around one in eight in the world, suffer from chronic hunger, regularly not getting enough food for an active life. We must see beyond our own desires, and consider our food waste and landfill sites in Hong Kong.
The actions of local people in collecting food waste on Lantau and Cheung Chau are encouraging. These initiatives have succeeded in reducing food waste gradually through education and by turning it into useful products to grow vegetables, and also creating jobs for women and retirees.
This local economy loop is happening in New York, Singapore and Tokyo; they are role models for Hong Kong to foster a more resilient and innovative society that grows food, rather than wastes it.