The $8.42 trillion promised by rich country governments to bailout banks would be enough to end global extreme poverty for 50 years and a massive step towards ending it forever, Oxfam said today ahead of the meeting of G20 leaders in London on Thursday.
Oxfam says G20 leaders could make a massive difference to the world’s poorest people by diverting a tiny fraction of the bailout money to provide an economic stimulus, social safety nets and health services for those affected by the economic crisis.
Oxfam is calling for a $580bn-a-year rescue package for poor countries made up of an immediate fiscal stimulus for the poorest countries of at least $24bn, debt relief and fulfillment of existing pledges to increase development aid.
Urgent action is also needed to crackdown on tax havens, which deprive developing countries of hundreds of millions of pounds of tax revenue every year – much more than they receive in development aid.
Barbara Stocking, Oxfam Chief Executive, said: “When you look at the amount of money that has been found for banks it seems inconceivable that G20 leaders will stand aside and allow the economic crisis to destroy poor people’s lives."
“Developing countries are reeling from dramatic declines in trade, remittances and foreign investment. Rich governments whose policies contributed to the crisis have a responsibility to help those who cannot afford their own bailouts."
“Without urgent action, hundreds of millions of the world’s poorest people will fall further into poverty. Losing your job is devastating wherever it happens but for millions people in poor countries, without benefits and health services to fall back on, unemployment will push them into destitution.”
An Oxfam report, published earlier this week, revealed women are hit hardest and are often the first to lose their jobs as countries slide into recession. For many, in developing countries the recession comes on top of high fuel and food prices that have already stretched communities to breaking point.
Oxfam is pressing for rich country governments to promote a ‘green new deal’ by ensuring their domestic rescue packages help tackle climate change by accelerating the transition to a low-carbon economy.
Oxfam is also calling for reform of international financial institutions, including the IMF and World Bank, to give developing countries a real say in the decisions that affect them.
Stocking said: “We cannot return to the situation where the greed of the richest was allowed to take precedence over the needs of millions. G20 leaders have a real opportunity to take a significant step towards a fairer, more sustainable world.”
Notes to editors
The $8.42 trillion – made up of capital injections, toxic asset purchases, subsidised loans and debt guarantees – is equivalent to more than $1,250 for every man woman and child on the planet. The annual cost of lifting the 1.4 billion people living on less than $1.25-a-day above this threshold is $173bn.