ONLINE EDITOR @KASIBC_AFRICA
World Leaders must act now to tackle Inequality G20
Dear Fellow South African,
When South Africa took over the Presidency of the
G20 nearly a year ago, we identified ‘
equality’ as one of the pillars of our term, alongside ‘
solidarity’ and ‘sustainability’.
We chose to focus on equality because it is essential to a more stable, prosperous and sustainable world. If the G20 is going to live up to its mission to tackle pressing global economic and financial issues, then it needs to significantly and urgently reduce inequality.
Global wealth inequality is stark. The world’s richest 10 percent account for more than half of total global income. These people account for a staggering 74 percent of total global wealth. The human cost of these inequalities is severe; one in four people globally face moderate or severe
food insecurity.
These huge disparities are unjust and consign billions of people to poverty. Inequality is bad for everyone. It makes the world less stable, fuels conflict and undermines democracy. It stifles
inclusive economic growth and prosperity.
Given the importance of equality to sustaining global growth, to social and political stability and to the legitimacy of international economic governance, it is good that at South Africa’s instance this will be the first time the G20 will focus on this matter and consider an in-depth report of this nature.
As Professor Stiglitz and his fellow experts note, the features of the international economy that perpetuate inequality “can be significantly affected by the decisions and actions of G20 governments”. They say that inequality is a policy choice. It is therefore critical that G20 leaders recognise the extent and urgency of the problem of inequality – and that they act accordingly.
Among the committee’s recommendations is the establishment of a permanent international body on inequality. This would be modelled along the lines of the Intergovernmental Panel on Climate Change (IPCC), which has been vital to global efforts to measure and respond to the
climate emergency. In a similar way, the proposed
International Panel on Inequality would bring focus to bear on inequality and measure, monitor and report on global and national trends in inequality among and within countries. It would be mandated to advise governments, multilateral bodies and institutions and the G20 on effective policy responses.
Another important part of our response to inequality is to promote
debt sustainability, especially for developing economies. Interest on sovereign debt repayments, particularly in Africa, is stifling public spending and economic growth. It is widening the gap between countries and within countries.
That is why we are using our G20 Presidency to advocate for the
reform of the global financial architecture. The committee’s report echoes our position, calling for multilateral development banks to have an ‘inequality-reducing agenda’. In a similar vein, it suggests that governments might agree to establish ‘
National Inequality Reduction Plans’, which would set clear goals to reduce both income and wealth inequality.
Although not all the recommendations made in the report are new, what we are pleased about is that this is the first time the G20 will be considering the issue of global inequality. It will be critical in the lead up to the Leaders’ Summit later this month that the report is widely-read and its recommendations given proper attention in the public discourse.
Inequality is one of the most pressing global issues of our time. This report provides a credible blueprint for the actions we need to take to overcome it.
With best regards,
MAKEKASIGREAT©®™ @KASIBC_AFRICA
