19th January 2015
The world’s richest 1% will soon own more than the rest of the world’s population put together a damning new report from Oxfam has claimed.
The analysis entitled, Wealth: Having it all and wanting more, from the anti-poverty charity highlights that the global wealth owned by the richest 1% increased from 44% in 2009 to 48% last year – and at this rate will be more than 50% in 2016. Members of this global elite had an average wealth of $2.7m per adult in 2014 said the paper.
Of the remaining 52% of global wealth, almost all, at 46% is owned by the rest of the richest fifth of the world’s population. The other 80% share just 5.5% and had an average wealth of $3,851 per adult – that’s 1/700th of the average wealth of the 1%.
The research comes on the back of the start of the World Economic Forum in Davos.
The international agency, whose executive director Winnie Byanyima will co-chair the Davos event, warned that the explosion in inequality is holding back the fight against global poverty at a time when one in nine people do not have enough to eat and more than a billion people still live on less than $1.25-a-day.
Byanyima said: “Do we really want to live in a world where the 1% own more than the rest of us combined? The scale of global inequality is quite simply staggering and despite the issues shooting up the global agenda, the gap between the richest and the rest is widening fast.
“In the past 12 months we have seen world leaders from President Obama to Christine Lagarde talk more about tackling extreme inequality but we are still waiting for many of them to walk the walk. It is time our leaders took on the powerful vested interests that stand in the way of a fairer and more prosperous world.
“Business as usual for the elite isn’t a cost free option – failure to tackle inequality will set the fight against poverty back decades. The poor are hurt twice by rising inequality – they get a smaller share of the economic pie and because extreme inequality hurts growth, there is less pie to be shared around.”
The international agency is calling on governments to adopt a seven-point plan to tackle inequality:
But the Institute of Economic Affairs has hit back at Oxfam, saying that fixating on inequality will do little to help people out of poverty
Ryan Bourne, head of public policy at the IEA said Oxfam is ”performing sophistry with numbers with its net wealth figures”.
He added: “They are utterly irrelevant to the hundreds of millions who are pulling themselves out of poverty as a result of increasing incomes due to the improved policy environment in previously very poor countries such as China and Vietnam.
“The claims made by Oxfam on the share of wealth going to the top 1% are based on highly misleading net wealth figures. Few would accept the idea that someone from a rich Western country with large debts is one of the poorest people in the world, but this is precisely what this measurement of wealth implies. Aggregating these sorts of figures over large populations is therefore meaningless. ”