The G7 countries owe 13 billion. dollars in the countries of the poor South

By | May 17, 2023

Hannah McKay/Pool Photo via AP

Despite the G7 countries failing to pay what they owe, their wealthy bankers are demanding that countries in the Global South pay $232 million a day in interest by 2028, Oxfam said on the sidelines of the G7 summit. •G7 debt of 8.7 trillion dollars due to the effects of climate change in the Global South, for which they are mainly responsible.

The rich G7 countries owe low- and middle-income countries about $13.3 trillion. dollars in development aid and support in the fight against climate change, reveals a new analysis by the non-governmental organization Oxfam ahead of the G7 Summit in Hiroshima, Japan.

Despite failing to pay what they owe, the G7 countries and their wealthy bankers are demanding that countries in the Global South pay $232 million a day in interest payments by 2028. Otherwise, this money could be spent on health care, education, gender equality and social protection. to face the effects of climate change, says the Organization in a statement issued today.

“The rich G7 countries like to present themselves as saviors, but in reality they have double standards, which are a deadly combination: they follow one set of rules while their former colonies are forced to follow another. Do what I say, not what I do,” said Oxfam International’s interim executive director, Amitabh Behar.

“It is the rich who owe the Global South. The aid they promised decades ago but never delivered. The enormous cost of the climate crisis caused by the senseless burning of fossil fuels. The enormous wealth that was built on colonialism and slavery. ”, he added.

“Every day the Global South pays hundreds of millions of dollars to the G7 and their wealthy bankers. This has to stop. It is time to expose the hypocrisy of the G7 for what it really is: an attempt to abdicate responsibility and maintain the neocolonial status quo,” Behar said.

As Oxfam reports, the G7 leaders are meeting at a time when billions of workers are facing real wage cuts and terrifying price increases for basic goods like food. World hunger has risen for the fifth consecutive year, while extreme wealth and extreme poverty have skyrocketed simultaneously for the first time in 25 years, highlighting stark disparities between rich and poor.

They owe trillions when they break their promises

Despite a G7 pledge last month to speed up the phase-out of fossil fuels, Germany is now pressing G7 leaders to approve public spending on natural gas. According to Oxfam’s calculations, the G7 owe low- and middle-income countries $8.7 trillion for catastrophic loss and damage caused by excessive emissions from their industrial activities, especially in the Global South. After 30 years of deadlock, rich countries agreed at the COP26 conference in Egypt to create a fund for losses and damages. But serious questions remain about how this system could work, says Oxfam.

The G7 governments are also collectively reneging on a longstanding promise made by rich countries to fund $100 billion a year from 2020 to 2025 to help the poorest deal with climate change.

In 1970, the rich countries agreed to allocate 0.7% of their GDP to financial aid, recalls the Organization. Since then, the G7 countries have failed to pay $4.49 trillion to the poorest countries, more than half of what they had promised.

“This money could make a significant difference,” Behar said. “They could be used to get children to school, for hospitals and life-saving medicines, to improve access to clean water, better roads, agriculture and food security, and much more. The G7 must pay its debts. It’s not kindness or charity, it’s a moral obligation.”

Hundreds of millions of people in conditions of extreme hunger

At least 258 million people in 58 countries around the world are currently experiencing acute hunger, an increase of 34% from last year. In East Africa alone, drought and internal conflict have pushed 36 million people below the hunger line, into conditions of extreme hunger, almost equivalent to the population of Canada. This is a record number, says Oxfam. The Organization estimates that up to two people starve to death every minute of every day in Ethiopia, Kenya, Somalia and South Sudan. The combined wealth of the 260 billionaires in the global agri-food sector has increased by $381 billion since 2020, the report says. At the same time, synthetic fertilizer companies increased their profits tenfold in 2022.

According to the IMF, the 48 countries most affected by the world food crisis face an additional nine billion dollars in the import budget in 2022 and 2023.

The G7 countries include 1,123 billionaires with a combined fortune of $6.5 trillion. Their wealth has grown in real terms by 45% over the past decade, the NGO estimates.

Oxfam proposes to tax G7 millionaires 2% and billionaires 5%. It could generate $900 billion a year for poor countries. The money could be used to support ordinary people in G7 countries and the global South facing skyrocketing prices and falling wages, the organization says.

Oxfam urges G7 governments to:

  • Cancel the debts of low- and middle-income countries that need it.
  • They restore the aid target of 0.7% of GNI, pay back aid arrears, and honor their commitment to provide $100 billion a year to help the poorest countries cope with climate change.

  • They impose new taxes on wealthy individuals and corporations.

  • Accelerate the redistribution of at least US$100 billion of existing Special Drawing Rights (SDRs) to low- and middle-income countries. They have committed to at least two new issuances of $650 billion by 2030.

Leave a Reply

Your email address will not be published. Required fields are marked *