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DEVELOPMENT: Globalisation Should Pick Up Hunger Tab

Gustavo Capdevila

GENEVA, Jan 30 2004 (IPS) - The globalisation process generates more than enough resources to finance programmes to fight hunger and poverty, states the initiative announced here Friday by Brazil’s president, with backing from other countries and the United Nations.

Brazil’s President Luiz Inácio Lula da Silva proposes to forge an international alliance to mobilise political will and financial support, and is calling for studies of appropriate mechanisms for collecting resources for a special fund.

Fresh funds could come from taxes on the weapons trade and on certain international financial transactions, suggested Lula on Friday, accompanied by U.N. Secretary-General Kofi Annan.

The presidents of Chile, Ricardo Lagos, and France, Jacques Chirac – supporters of their Brazilian colleague’s plan – reckoned that little could be expected from official development assistance (ODA), the traditional source of funding in the past decades.

According to international agreement under the United Nations, the industrialised countries should set aside 0.7 percent of their gross domestic product (GDP) for the development of the nations of the South.

But of 30 industrialised countries, just three currently achieve that mark. ODA has hit a ceiling and it is unlikely that contributions from industrialised countries are going to increase, said Lagos.

The phenomena of poverty and hunger are reflected in the 1.1 billion people worldwide who struggle to get by on less than a dollar a day, and the 840 million who cannot meet their daily nutritional needs.

Lula stated in his Geneva address that hunger is a “weapon of mass destruction” that kills 24,000 people each day, including 11 children every minute.

The aim of halving world poverty by 2015 is one of the Millennium Development Goals set by the U.N. General Assembly in 2000.

To achieve those goals would require an ODA increase from today’s 50 billion dollars a year to 110 billion dollars, said Chirac.

But the French president ruled out the possibility that rich countries would provide the additional 60 billion dollars, which is why new sources of funds are needed, he said.

One potential source would be the International Finance Facility (IFF), the brainchild of experts at Britain’s Treasury and Department for International Development, proposing a “pre-financing” system for development aid.

The IFF project is to come under international debate in Paris in April, but Chirac, Lagos and Lula have been sympathetic to the plan.

The French president also favours setting up a working group to study other financing alternatives. For now, this group will be made up of French and Brazilian representatives, who will consider the IFF as well as the possibility of imposing taxes on international transactions, like arms sales and certain financial operations.

Chirac played down the prospect of implementing the “Tobin Tax”, a proposal by non-governmental organisations – including many from France – to tax international financial transactions, and use those revenues to fight poverty and promote sustainable development.

James Tobin, who won the Nobel for Economics in 1981, had studied the possibility of imposing a tax on international capital flows, but did not necessarily agree with the idea of using the funds for development, as civil society groups began to suggest in the 1990s.

The initiative announced Friday will not be a Tobin Tax, which has not been successful, said Chirac.

Funding for the fight against poverty and hunger must come from “the tremendous wealth” generated by the economic globalisation process, agreed the three national leaders.

The additional 60 billion dollars in annual development aid needed, said Chirac, are just a drop in the bucket compared to the 8.0 trillion dollars that move global commerce each year.

Lagos said that globalisation continues to suffer a “social deficit”, a problem that has yet to be resolved. The Chilean president noted that in the alliance against hunger there is a place for the private sector.

The working group of Brazilian and French experts will present their conclusions in September during a meeting to take place in parallel to the U.N. General Assembly.