Dealing with poverty globally
By Gerard Errera
Global taxation such as on air-travel or financial
transactions could finance the fight against world poverty.
This year must be a watershed in the fight against
poverty. In order to "make poverty history," both France and Britain are
pushing bold new ideas. But to appreciate them, one needs first to
understand the terms of the current debate.
Five years ago, the United Nations General Assembly
adopted a set of targets for poverty reduction and human development to
be achieved by 2015, the so-called Millennium Development Goals (MDGs).
But with the resources available, they are beyond reach, especially in
sub-Saharan Africa.
The need for a radical increase in aid to poor countries
is beyond dispute. Nor is there much dispute about the amount required -
$50 billion a year in additional aid would be enough to meet the goals
in 2015, a paltry sum compared with a global GNP of $40 trillion.
Today the debate is about where the money should come
from. On this, both France and Britain are eager to innovate. First,
developed countries should aim at devoting 0.7 per cent of their GDP to
Official Development Assistance. France has set itself this target for
2012.
The United Kingdom is in a position to reach it by the
same date. But we need to do more. Development cannot wait, and needs
have to be satisfied now. The sooner aid comes to recipient countries,
the more effective it will be. Aid also has to be more stable and
predictable. "Stop and go" policies hamper development.
So new means are needed for finance development, with
France and the U.K. at the forefront of this search. The U.K. has
proposed creating an International Finance Facility (IFF).
This is a bold new idea which would permit an immediate
increase in the financial transfers to poor countries, thus stabilising
human development programmes over the long term.
Our two countries, together with the Bill & Melinda
Gates Foundation, are working on a pilot IFF scheme to promote vaccine
immunisation in poor countries.
France has, for some time, strongly advocated the
creation of global taxes to finance the fight against poverty.
This would not require the creation of any new
international bureaucracy, and would be based on voluntary cooperation
between sovereign states. Its main advantage would be to secure stable,
immediately available financing for the MDGs.
Last year, in a joint endeavour between emerging and
developed countries, Brazil, Chile, France and Spain looked at several
options for global taxes.
The report they co-authored concluded in favour of the
economic feasibility of international taxes. Building on this emerging
consensus, President Chirac, in his Davos speech in January, suggested a
very small levy (about one ten-thousandth) on international financial
transactions and some taxes on air transport.
Admittedly, international taxation is controversial.
However, the public outpouring of generosity throughout the world
following the Asian tsunami, points to a shift in world opinion. A
contribution of $2-$4 on every plane ticket in the world would produce
almost enough revenue to finance the worldwide fight against AIDS.
Who could refuse such an effort? Who could refuse to
stem the "silent tsunamis" which happen every day in Africa? As
President Chirac said, "The disproportion between the modest efforts
needed and the benefits everyone would reap from them is striking."
France's and Britain's proposals, while different, are
complementary and reinforce each other. The IFF would ensure that
government aid money would be made available sooner.
The French proposals would contribute to the same goal
while avoiding increasing the developing countries' debt. President
Chirac has pledged his full support for the British proposals.
Both Prime Minister Tony Blair and Chancellor of the
Exchequer Gordon Brown have welcomed the French proposals. Aid is not,
of course, the only component of a development strategy.
Debt relief, to which we remain fully committed, is also
essential. We recognise that, ultimately, greater integration of poor
countries in world trade through better access to our markets is an
essential driver of growth and poverty reduction.
But aid is indispensable. We are one-third of the way to
the target date for the achievement of the MDGs. Decisions made this
year will determine the shape of the aid development system for the
years to come. Now is the moment to act.
We are fortunate that Britain holds the chair of the G-8
during this crucial period.
It got off to a good start at the G-7 meeting of Finance
Ministers in London: with the backing of his European partners, the
Chancellor of the Exchequer succeeded in putting development at the top
of the agenda. It is our common duty to see that it stays there.
(The writer is the French Ambassador to the United
Kingdom.)
The Hindu |
