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30 OCT 2014

Billionaires increase twofold but million mothers die in childbirth

Billionaires increase twofold but million mothers die in childbirth
Extreme inequality spiralling out of control

Rising inequality could set the fight against poverty back by decades, Oxfam warned today as it published a new report entitled ‘Even it Up: Time to End Extreme Inequality’, showing that the number of billionaires worldwide has more than doubled since the financial crisis. At the same time, hundreds of millions live in abject poverty without essential health care or basic education.

In countries around the world, prosperity is not trickling down to ordinary people, but up to those at the top, whose exceptional wealth is growing ever more rapidly. The richest 85 people – who Oxfam revealed in January as having the same wealth as the poorest half of the world’s population – saw their collective wealth increase by $668 million per day between 2013 and 2014. That’s almost half a million dollars every minute.

Despite the growing consensus among world leaders that inequality is a crucial challenge of our time and that failure to act is both economically and socially damaging, little action has materialised. In its new campaign, also calledEven it Up’, Oxfam pushes world leaders to turn rhetoric into reality and ensure the poorest people get a fairer deal. Action is needed to clamp down on tax dodging carried out by multinational corporations and the world’s richest individuals. Big global corporations and the wealthiest people must pay their fair share to governments’ coffers, so that countries can tackle inequality and build fairer societies.

Winnie Byanyima, Oxfam International Executive Director, said: ‘Far from being a driver of economic growth, extreme inequality is a barrier to prosperity for most people on the planet. Today wealth is trickling upwards, and will continue to do so until governments act. We should not allow narrow-minded economic doctrine and the self-interest of the rich and powerful blind us to these facts. Around the world, millions of people are dying due to a lack of health care and millions of children are missing out on school, while a small elite have more money than they could spend in a lifetime. ‘Inequality hinders growth, corrupts politics, stifles opportunity and fuels instability while deepening discrimination, especially against women’.

The potential benefit of redistributing the wealth of the very richest, by even a tiny amount, tells a compelling story. A levy of just 1.5 per cent on the wealth of the world's billionaires today could raise enough each year to get every child into school and deliver health care in the poorest countries.

The effect of curbing inequality would be as dramatic as would be the failure to act. In India, for example, halting the recent increase in inequality could enable 90 million more people escape extreme poverty by 2019. In Kenya, 3 million more people could be pushed below the poverty line by the same year if inequality there remains at current levels rather than declining slightly.

Investment in free public services will be crucial to closing the gap between the richest and the rest. Every year, 100 million people are driven into poverty because they are forced to pay for health care. From 2009-2014, at least one million women died in childbirth due to a lack of basic health services. Meanwhile, education fees still exclude far too many. In Ghana, for instance, the poorest families would have to pay 40% of their income to send just one child to a low-fee school, underlining the importance of free education for all.

But for those at the top, it’s a different tale as they have enough assets to last them well beyond their years. If the world's three richest people were to spend $1m every single day each, it would take each one of them around 200 years to exhaust all of their wealth. This is not a rich country story; today there are 16 billionaires in Sub-Saharan Africa, alongside the 358 million people living there in extreme poverty, while in South Africa, inequality is now greater than it was at the end of apartheid.

With one of the widest income inequality gaps among the developed economies, this phenomenon is no stranger to Hong Kong. More than a million people in Hong Kong live under the official poverty line, and nearly half of them are working poor families. However, the top one per cent of the population is only getting richer and richer; the top 10 billionaires in Hong Kong have a total wealth of about HK$1,113.8 bn[1], which is the equivalent of half of the Hong Kong’s GDP in 2013 (HK$2,125.3bn)[2].

Though the government introduced a statutory minimum wage, cases where poor people cut back on basics like food to pay rent is still prevalent. Oxfam Hong Kong believes that it is important for the minimum wage to be enough to support the basic cost of living of an employee and a dependent/unemployed person. Oxfam urges the HKSAR government to raise the minimum wage to $35 and review it each year to assure that it can help low-wage earners make ends meet. This can ensure at least a better distribution of wealth and tackle the rising inequality issue that Hong Kong is facing.  

- Ends -

References:
1. “The Hong Kong’s 50 Richest” , Forbes,  http://www.forbes.com/hong-kong-billionaires/list/
2. Hong Kong Monthly Digest of Statistics (October 2014),  http://www.statistics.gov.hk/pub/B10100022014MM10B0100.pdf

Download full report:http://www.oxfam.org/en/research/time-end-extreme-inequality

 

About Oxfam
Oxfam is a worldwide development organisation that mobilises the power of people against poverty.

For media enquiries, please contact

Sarah Chu
Senior Communications Officer
Telephone: + 852 3120 5280
Email: sarah.chu@oxfam.org.hk