On January 22, 2021, a doctor takes a swab sample from a Covid-19 patient in his home on the eastern outskirts of Lima.
ERNESTO BENAVIDES | AFP | Getty Images
LONDON – Oxfam estimates that the world’s 1,000 richest people have made up for their coronavirus pandemic losses within nine months. However, the global charity estimates it could take more than a decade for the world’s poorest to recover.
“The 10 richest men in the world have seen their total wealth grow by half a trillion dollars since the pandemic started – more than enough to pay for a Covid-19 vaccine for everyone and ensure no one is pushed into poverty by the pandemic will, “Oxfam said in a report titled” The Inequality Virus “.
At the same time, the pandemic “ushered in the worst employment crisis in over 90 years, in which hundreds of millions of people are underemployed or unemployed”.
Women and ethnic minorities are hardest hit by the pandemic, Oxfam said.
“Women and marginalized racial and ethnic groups are bearing the brunt of this crisis. They are more likely to be driven into poverty, starve more often and be more likely to be excluded from health care,” said Gabriela Bucher, executive director of Oxfam International in the report.
“However, billionaires ‘fortunes rebounded as stock markets rebounded despite the ongoing recession in the real economy. Their total wealth reached $ 11.95 trillion in December 2020, the equivalent of G-20 governments’ total Covid-19 recovery spending . “
As the global pandemic hit Europe and the United States in early 2020, global stock markets collapsed as lockdowns were put in place to fight the virus. But they have since rebounded thanks to unprecedented monetary and fiscal stimulus measures from governments and central banks aimed at mitigating the effects of the health crisis.
Oxfam said the road to recovery will be much longer for people who struggled before Covid. “When the virus emerged, more than half of workers in poor countries were living in poverty, and three-quarters of workers worldwide had no access to social protection such as sick pay or unemployment benefits,” it said.
Oxfam’s report was released on Monday to mark the start of the World Economic Forum’s Davos agenda, which is practically this year amid the pandemic.
The forum brings together political and business leaders to find ways to improve the state of the world, despite criticism that debates rarely lead to significant changes in government or corporate policy. A central topic on the agenda is the question of how the world economy can be rebuilt on a fair basis after the global health crisis.
There are already concerns about the uneven adoption of coronavirus vaccines. Last week, the World Health Organization director general said the world was on the brink of “catastrophic moral failure” because richer countries commanded most of the vaccine supplies available.
The Oxfam report also called for “the fight against inequality to be at the heart of economic rescue and recovery efforts”.
“Covid-19 has the potential to increase economic inequality in almost every country at the same time. This is the first time since records began over a century ago. Rising inequality means that the number of people living in a country can take at least 14 times longer. ” Poverty returned to pre-pandemic levels when it took the fortunes of 1,000 mostly white and male billionaires to recover, “Oxfam said.
Longstanding inequality
Oxfam based its calculations on several data sources; The figures for the world’s richest people come from Forbes’ 2020 Billionaires List and used World Bank data to model the impact “an increase in inequality in almost every country at the same time” would have on global poverty.
It noted that the World Bank found that if inequality (measured by the Gini coefficient) increases 2 percentage points annually and global GDP per capita shrinks 8%, 501 million more people are still from less than 5, Living $ 50 a day will be living in 2030 compared to a scenario where inequality does not increase.
“As a result, global poverty would be higher in 2030 than it was before the pandemic. 3.4 billion people are still living on less than $ 5.50 a day. This is the bank’s worst case scenario, but it is projected for an economic contraction most developing country countries agree with this scenario, “Oxfam said.
Oxfam conducted a global survey of 295 economists from 79 countries for the report, and said 87% of respondents expect “spikes” or “steep spikes” in income inequality in their country as a result of the pandemic. “
Temporary tax on excess profits
The charity said a temporary tax on excess profits of the 32 global companies that “made the most during the pandemic” could have raised $ 104 billion in 2020.
“This is enough to provide unemployment benefits to all workers and financial assistance to all children and the elderly in low- and middle-income countries,” it said, although the business community is likely to oppose a tax hike call would argue that it creates jobs and income and supported.
Mark Littlewood, director general of the Institute of Economic Affairs’ free market think tank, responded to the report that “Oxfam is right to highlight the impact of the pandemic on the world’s poorest … the solutions proposed by the charity reveal a fundamental misunderstanding of both the economy as well as the fight against poverty. “
“Increasing taxation on the rich might make headlines, but it misleads the public that cutting at the top automatically leads to more wealth at the bottom. In reality, interventionist policies are far more likely than they are to destroy wealth successfully redistributing it. “”
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