THE large gap in wealth between the developing and developed countries has been a major global concern ever since the end of World War II and the situation has not improved in recent years.
In fact, under the new dispensation of liberalisation of trade and globalisation, whereby there has been an end to preferential markets, and developing countries have to compete with the developed world on the international market, the situation has worsened because there is not a level playing field in which to compete as the developing countries with relatively small economies and low levels of industrial development, coupled with a complexity of socio-economic issues and high indebtedness, simply cannot match the economies of scale of the developed world.
The end result is a widening gap between the two groups.
A study by the World Institute for Development Economics Research at United Nations University reports that the richest 1% of adults alone owned 40% of global assets in the year 2000, and that the richest 10% of adults accounted for 85% of the world total. The bottom half of the world adult population owned barely 1% of global wealth.
The richest one percent of people in the world receive as much as the bottom 57 percent, or in other words, less than 50 million richest people receive as much as 2.7 billion poor.
In addition, the global financial crisis has seen financial and other forms of assistance to the developing world drying up which is “adding fuel to fire.”
Ironically, many developed countries are finding increasing financial resources to spend on the military and on useless and destructive wars. World military expenditure in 2010 is estimated to have reached $1.63 trillion at 2010 prices. This represents a 1.3 per cent increase in real terms over 2008 and a 50 per cent increase since 2001 and corresponds to 2.6 per cent of world gross domestic product (GDP), or approximately $236 for each person in the world.
The USA, with its massive spending budget, is the principal determinant of the current world trend, and its military expenditure now accounts for just under half of the world’s total, at 41% of the world’s total.
Our late President Dr Cheddi Jagan, who was a vociferous advocate for cuts in global military spending to facilitate development in poor countries had asserted that, with a five percent cut, poverty in the world could be eradicated or brought to a minimal level.
Against this backdrop, President Donald Ramotar, in his recent address to the United Nations on behalf of the Caribbean Community on the occasion of the UN high-level Thematic Debate on the State of the World Economy, highlighted the global concern about the persistent, adverse state of the world economy and the UN’s obligation to ensure that the response to these challenges is inclusive, effective and sustained.
The President’s appeal is indeed a most pertinent and timely one as the poorer countries are finding it increasingly difficult to meet the increasing global and internal challenges that are facing them.
He noted that “while the international community is prepared to explore new approaches, policies and initiatives considered taboo or morally hazardous in the past, for the developed countries who now find themselves in difficulties – with huge debt overhang and servicing, huge fiscal deficits and high levels of unemployment” they are not prepared to move with the same broadmindedness on initiatives that the Caribbean regards as vital for a sustainable medium-term strategy.
The problem has always been the unwillingness of the developed countries to implement tangible measures to ease the plight of the developing countries because of self interest. Unless this selfishness on the part of the developed world is reversed, bridging the gap between the poor and the rich will remain very remote and hopeless.