Rich countries get richer and the poor get . . . ?

Social justice news
November 2003

Globalization's cardinal sins
Labor slump is worse since Great Depression
Rich countries get richer and the poor get . . . ?
U.S. bishops reflect on global agriculture

Rich countries get richer and the poor get . . . ?
Development funds are moving at record levels from poor countries to rich ones, United Nations Secretary-General Kofi Annan charged during a high-level meeting at the UN on October 30. Annan challenged the UN General Assembly to face the stark fact that, "even taking all subtlety and nuance into account," developing countries made the sixth consecutive and largest ever transfer of funds to "other countries" in 2002, a sum totalling "almost $200 billion."

"Funds should be moving from developed countries to developing countries, but these numbers tell us the opposite is happening," he told the Assembly, as well as heads of the affiliated international financial institutions, on the second day of a high-level dialogue on financing for development.

"Funds that should be promoting investment and growth in developing countries, or building schools and hospitals, or supporting other steps towards the Millennium Development Goals, are, instead, being transferred abroad."

The Millennium Development Goals, worked out at a UN summit in New York in 2000, collectively aim to halve extreme poverty worldwide by 2015.

If discussion about financing for development is not to ring hollow, the balance sheet must be reversed and the system fixed so that all countries and people, especially the poorest, can benefit, Annan said.

The wish to fix these problems brought about the meeting in Monterrey, Mexico, last year, which, though "not free of tension and disagreement," did achieve real breakthroughs, he said.

A major breakthrough was the effort made to reverse a troubling and devastating decade of decline, or stagnation, by making new commitments to official development assistance (ODA), according to Annan. Other Monterrey successes were improving government policy coherence, looking at poor people and poor countries as partners in the development process, and acknowledging the mutual accountability and mutual responsibilities of rich and poor.

Trade tariffs and subsidies have been stifling the ability of poor countries to compete fairly in the international trading system and trade their way out of poverty, Annan told the Assembly, while too many developing countries have been carrying too much debt. Too many developing countries have also been excluded from meaningful participation in the decision-making of key international bodies on economic and financial and trade issues, he said.

Back to page top