Eight men own the same wealth as the 3.6 billion people who make up the poorest half of humanity, according to a new report published by Oxfam today to mark the annual meeting of political and business leaders in Davos, Switzerland. It shows that the gap between rich and poor is far greater than had been feared.
Oxfam’s report, ‘An economy for the 99 percent’, details how big business and the super-rich are fuelling the inequality crisis by dodging taxes, driving down wages and using their power to influence politics. For example, billionaires in Brazil have sought to influence elections and successfully lobbied for a reduction in tax bills while oil corporations in Nigeria have managed to secure generous tax breaks.
The report shows how our broken economies are funnelling wealth to a rich elite at the expense of the poorest in society. The richest are accumulating wealth at such an astonishing rate that the world could see its first trillionaire in just 25 years. To put this figure into perspective – you would need to spend US$1 million every day for 2,738 years to spend US$1 trillion.
Winnie Byanyima, Executive Director of Oxfam International, said: ‘It is obscene for so much wealth to be held in the hands of so few when one in 10 people survive on less than US$2 a day. Inequality is trapping hundreds of millions in poverty; it is fracturing our societies and undermining democracy.’
Oxfam calls for a fundamental change in the way we manage our economies so that they work for all people, and not just a fortunate few. Oxfam’s report outlines a blueprint for a more human economy which requires corporations and high incomes to pay their fair share of tax, workers are paid a decent wage and ensure economies work for women.
Inequality is widespread in the world. Seven out of 10 people live in a country that has seen a rise in inequality in the last 30 years. Between 1988 and 2011, the incomes of the poorest 10 per cent increased by just US$65, while the incomes of the richest 1 per cent grew by US$11,800 – 182 times as much.
Women, who are often employed in low pay sectors, face high levels of discrimination in the work place, and who take on a disproportionate amount of unpaid care work often find themselves at the bottom of the pile. On current trends it will take 170 years for women to be paid the same as men.
In Hong Kong, wealth inequality is worse than ever before and has already reached an alarming level with the richest 10 per cent of the city’s households earning 29 times more than the poorest 10 per cent according to Oxfam’s Hong Kong Poverty report released last October. Forbes estimated last year that the combined wealth of the 18 richest people in the city, however, amounts to HK$1.39 trillion, which exceeds the Hong Kong government’s reserve of 1.38 trillion.
‘Over the past five years, Hong Kong's total wealth has increased, yet about 1 million people are living in poverty while half of them - despite their hard work - live in working poor families. Oxfam believes that a just society should ensure that the poor have the right to lead a dignified life. The growth of the economy or any profit making craze should not come at the cost of worker’s livelihoods,’ said Kalina Tsang, Head of Oxfam’s Hong Kong, Macau, Taiwan Programme.
‘We urge the Hong Kong government to take the Policy Address as an opportunity to implement more pro-poor policies to put an end to the injustices the working poor face, in particular, poor women. The Hong Kong government should review minimum wage annually, and – as the biggest employer – should take the lead to scrap the MPF offsetting mechanism so that its contracted and outsourced workers are better protected,’ Kalina Tsang added.
‘An Economy for the 99 percent’ also reveals how big businesses and the super-rich are fuelling the inequality crisis. It shows how, in order to maximise returns to their wealthy shareholders, big corporations are dodging taxes, driving down wages for their workers and the prices paid to producers. Corporate tax dodging costs poor countries at least US$100 billion every year. This is enough money to provide an education for the 124 million children who are not in school and fund healthcare interventions that could prevent the deaths of at least six million children every year.
According to Oxfam’s report ‘Tax Battles’, released last December, Hong Kong was ranked the ninth worst tax haven in the world. ‘The Hong Kong government has the responsibility to stop multinational corporations’ abuse of tax havens and ensure that they pay their fair share by enhancing tax transparency. We are calling on the government to put legislation in place that regulates the submission and disclosure of country-by-country reports, and requires mandatory disclosure of beneficial ownership so as to increase public scrutiny on how multinational corporations pay taxes,’ said Kalina Tsang.
Oxfam Hong Kong also urges business leaders to display more corporate social responsibility in the face of this growing wealth gap to play their part in building a human economy.
The World Economic Forum has responsive and responsible leadership as its key theme this year. Winnie Byanyima, Executive Director of Oxfam International will be attending the World Economic Forum in Davos from the 17 – 20 January, 2017, to highlight the urgent need for action to tackle inequality. There, she will be urging business leaders to make a start by committing to pay their fair share of tax and by ensuring their businesses pay a living wage.
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Notes to editors
The World Economic Forum will be held in Davos, Switzerland from the 17 – 20 January 2017. For more information on World Economic Forum, see www.weforum.org. People around the globe can also join the Oxfam campaign at www.evenitup.org.
The world’s eight richest people are, in order of net worth:
(1) Bill Gates: American founder of Microsoft (net worth US$75 billion)
(2) Amancio Ortega: Spanish founder of Inditex which owns the Zara fashion chain (net worth US$67 billion)
(3) Warren Buffett: American CEO and largest shareholder in Berkshire Hathaway (net worth US$60.8 billion)
(4) Carlos Slim Helu: Mexican owner of Grupo Carso (net worth: US$50 billion)
(5) Jeff Bezos: American founder, chairman and chief executive of Amazon (net worth: US$45.2 billion)
(6) Mark Zuckerberg: American chairman, chief executive officer, and co-founder of Facebook (net worth US$44.6 billion)
(7) Larry Ellison: American co-founder and CEO of Oracle (net worth US$43.6 billion)
(8) Michael Bloomberg: American founder, owner and CEO of Bloomberg LP (net worth: US$40 billion)
New and better data on the distribution of global wealth – particularly in India and China – indicates that the poorest half of the world has less wealth than had been previously thought. Had this new data been available last year, it would have shown that nine billionaires owned the same wealth as the poorest half of the planet, and not 62, as Oxfam calculated at the time.
Oxfam’s calculations are based on global wealth distribution data provided by the Credit Suisse Global Wealth Data book 2016: http://publications.credit-suisse.com/tasks/render/file/index.cfm?fileid=AD6F2B43-B17B-345E-E20A1A254A3E24A5
The wealth of the world’s richest people was calculated using Forbes' billionaires list last published in March 2016. http://www.forbes.com/sites/kerenblankfeld/2016/03/01/forbes-billionaires-full-list-of-the-500-richest-people-in-the-world-2016/#10a1d6276c24
Oxfam is a worldwide development organisation that mobilises the power of people against poverty.
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