Davos: How Europe can tackle extreme wealth inequality

By Àngela Corbalán, Oxfam’s Head of EU Communications and Deputy Head of EU Office

As world leaders arrive in Davos for the first day of the World Economic Forum, storm clouds are gathering overhead. Skyrocketing global inequality has shone a flashlight onto the murky workings of global finance, with Davos becoming center stage this week of how to address this imbalance of power.

Ahead of this year’s conference, a new Oxfam study has shown how wide the chasm now is between the ‘haves’ and ‘have nots’. Wealth: Having It All and Wanting More demonstrates that if current economic trends continue, next year the wealthiest 1 per cent on the planet will own more than everyone else combined. This staggering imbalance of wealth is holding back the fight against poverty at a time when 1 in 9 people do not have enough to eat, and more than a billion people live on less than $1.25 a day. Extreme inequality used to be seen as a problem solely for developing countries, where presidential jets flew over slums and shanty towns. Now it affects us all.

World leaders such as US President Barack Obama, French President François Hollande and IMF chief Christine Lagarde have already spoken about the dangers runaway inequality can cause. Other European leaders must also take up the call. The EU should act to stem the torrent of wealth flowing from the poorest people in the world to the richest – starting with these three concrete steps.

Firstly, the EU must take decisive action to fight tax dodging both within Europe and beyond. Tax evasion and avoidance by large companies and wealthy individuals cost Europe at least €120 billion in lost tax revenue every year, not to mention the billions siphoned away from developing economies in desperate need of revenue to fund public services like health and education.

Secondly, the EU must support ambitious plans to fund the upcoming UN-backed Sustainable Development Goals, including a re-commitment to providing 0.7% of their annual GDP as overseas aid to developing countries. A new UN tax body is also badly needed to re-write the current unfair international tax rules that deprive poor countries of millions in revenue, and should be agreed at the third International Conference on Financing for Development in Addis Ababa, Ethiopia in July.

Finally, a mandatory register for European lobbyists must be set up to shed light on corporate practices that keep the cogs of global inequality spinning. Twenty per cent of billionaires have interests in the financial and insurance sectors, which spent €550m whispering into the ears of policy-makers in both Brussels and Washington in 2013. The pharmaceutical and healthcare sectors – also favorites of the super-rich – spent €500m lobbying both the EU and the United States in the same year.

Oxfam is concerned that the lobbying power of these industries is road blocking the major reforms needed to the global tax system, and giving stringent intellectual property rights priority over the health of the world’s poorest people.

Increasing evidence from many sources, including the International Monetary Fund, shows that economic inequality isn’t just bad for those at the bottom but also damages economic growth. Putting the brakes on extreme wealth inequality must happen now for everyone’s benefit, before the storm clouds really do come rolling in.

European ‘hot air’ should not inflate overseas aid spending

Posted by oxfameu on 20/11/14
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By Hilary Jeune, Oxfam’s EU policy advisor

When 2015 was declared the European Year of Development, it was seen as an ideal opportunity for the European Union (EU) to raise awareness on the bloc’s role in lifting people out of poverty. Yet with the calendars counting down fast, this commitment now appears to be more ‘hot air’ than actual assistance – lots of bluster that simply never materializes on the ground.

This doubt has been brought further into the spotlight today by the release of CONCORD’s new AidWatch report, Aid Beyond 2015: Europe’s role in financing and implementing sustainable development goals post 2015.

What’s the problem?

The report shows the EU’s approach to development aid could do with a breath of fresh air. Despite the growing number and scale of humanitarian and development challenges being broadcast on news outlets across Europe, the EU’s development funding still has a €41 billion hole in it – an amount which could pay for the EU’s current Ebola response to be expanded over forty times.

The EU has also deliberately over counted the amount of aid transferred to developing countries, inflating the figure by €5.2 billion in 2013. Both EU governments and institutions did this by including funding for student and refugee costs, as well as other domestic programs and interest on developmental loans in their overseas aid spending. To claim this interest on already cancelled debt as development aid is staggering when you consider that some EU countries made over €1 billion in interest on loans to developing countries in 2013, with France alone receiving €239 million in interest from development loans at a time when French aid budgets were being slashed. Such actions mean that while global aid appears to have slightly increased, actual aid to the world’s poorest countries – particularly in Africa – will drop by around 5% until 2016.

What are the solutions?

Despite this pessimism surrounding the EU’s development contributions, next year will present the opportunity for both EU governments and institutions to redeem themselves by ensuring a genuine commitment to combating global poverty and inequality.

Firstly, the EU should ensure that upcoming changes to the definition of developmental aid specify that aid is used to eradicate poverty and puts people first, rather than creating new ways for donors to artificially inflate the amount they actually give.

Secondly, both member states and institutions need to prove their mettle and recommit to the aid targets they have so far failed to achieve. Only Luxembourg, Sweden, Denmark and the UK have met the 0.7% of Gross National Income (GNI) target spent on development funding, with half of the EU member states projected to miss the 0.56% target set for 2010. If the EU wants to create a positive incentive for increased global funding for the world’s poorest, it needs to set a far better international example.

Finally, the EU should recommit to aid effectiveness principles and make sure that its contribution has a positive and sustainable impact on the lives of the world’s poorest people.

The EU may have failed to keep its funding promises to help combat global poverty, but with the 2015 European Year of Development fast approaching there is time yet for Europe to shake off the funding cobwebs, turn it’s rhetoric into reality and help improve the lives of poor people the world over.

EU needs to do more to stop the spread of Ebola

Posted by oxfameu on 16/10/14
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By Natalia Alonso, Oxfam’s Deputy Director of Advocacy & Campaigns

The Ebola outbreak in West Africa will not be contained unless more is done to prevent new infections.

The UN is planning to tackle the illness by treating people already infected with the disease, tracing their contacts and ensuring safe burials, which is important. But Oxfam believes that more work needs to be done on stopping people getting infected in the first place.

In today’s extraordinary EU meeting on Ebola, Europe was more concerned about its border controls, rather than what it should be doing to contain the spread of the disease in West Africa.

Europe needs to get serious by deploying more medical staff and equipment as well as military personnel in the next two weeks. Otherwise, the EU will miss a very narrow window of opportunity to halt this epidemic.

The aid agency is appealing for more funds to help prevent the spread of Ebola which is ravaging the region. Infection rates continue to grow with the number of cases doubling about every 20 days. The World Health Organisation has put the death rate from this outbreak at 70% and has warned that there could be 10,000 new cases a week in West Africa by December.

The number of Ebola cases, and suspected Ebola cases, has now exceeded 8,000 and the outbreak has claimed 4,500 lives, almost all of them in Liberia, Sierra Leone and Guinea.

Up until now, the response from most EU governments has been woefully inadequate. While tackling the disease requires new, fully-equipped treatment and isolation centers, as well as medical professionals to treat Ebola cases, prevention of new infections must also be a priority.

We must break the chain of infection by equipping people with the means to protect themselves from contracting this deadly disease in the first place.

We have the expertise to help contain the disease, but funds, personnel and equipment are desperately needed to make this happen.

What’s Oxfam calling on Europe to do?

EU Foreign Ministers meeting on Monday in Luxembourg should provide the people, equipment and money required to save lives and bring Ebola under control. Ministers should agree to:

Fill the human resources gap. This crisis requires not only money, but people. Ministers should commit to mobilizing and deploying greater numbers of specialist medical staff who can train health workers, as well as military personnel for their logistics capabilities. This military deployment is crucial to provide the surge in capacity in the time frame necessary to break transmission rates. Military engagement should be strictly coordinated with the UN and its partners.

Ensure adequate financing, a reliable medical evacuation facility (medevac), and air-bridges are in place by 30th October, in line with clear targets outlined in the UN Global Framework.

Provide assets to the EU’s Civil Protection Mechanism voluntary pool.

Provide air transport options to support medevac and other medical facilities to receive and treat international aid workers, regardless of country of origin, who may become infected as a result of their work in an Ebola treatment facility.

What’s Oxfam doing on the ground?

International agency Oxfam is planning to spend over €27 million to triple its programmes in Sierra Leone and Liberia, and plans to concentrate on reducing transmission rates. Although funding changes on a daily basis, it is nowhere near this target yet.

So far Oxfam has significantly stepped up its water and sanitation supply to Ebola treatment centres and community care centres, and its supply of hygiene materials, like soap and bleach, in Sierra Leone and Liberia. It is supplying personal protective clothing for front line community health workers and burial teams, and training community health workers. The aid agency is also helping in the construction of treatment centres.

Oxfam is boosting its mass public information campaign over the radio, billboards and text messages about how people can best protect themselves from catching the disease.

The aid agency is also working on prevention in Gambia, Guinea Bissau and Senegal, where there have been no widespread outbreaks of the disease.

However, in order for Oxfam to scale up its Ebola response, further funding is needed.

Enough Oxfam staff members with the expertise and knowledge to work on the Ebola response have stepped forward to volunteer to travel to the region to work on programmes. The major stumbling block to its deployment is a lack of funds.

Photo: A healthcare worker checks the temperature of a woman entering Mali from Guinea at the border in Kouremale. REUTERS/Joe Penney.

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Oxfam's EU Advocacy office in Brussels works to ensure EU policies and practices affecting poor countries have a greater impact on those most in need. Our work spans numerous policy areas including development aid, food security, climate change, and the provision of humanitarian assistance to victims of conflicts and natural disasters. more.

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