World’s richest recouped wealth lost due to COVID-19 in 9 months but poorest will take over a decade: Oxfam inequality report

Those already living on the edge of poverty were hit hardest by the COVID-induced crisis. Here, daily wage labourers migrate to their hometown on foot during a government-imposed nationwide lockdown as a preventive measure against the COVID-19 coronavirus, a file photograph.

The wealth of the world’s top 1,000 billionaires returned to pre-COVID levels in nine months but it could take 14 times longer – more than a decade – for the world’s poorest, says a new report released on Monday. Titled “ The Inequality Virus ”, the annual report by global non-profit Oxfam International said that the COVID-19 pandemic had led to a rise in inequality in almost every country at the same time – the first such instance since records began over a century ago. 

The report, published ahead of the World Economic Forum’s Davos Agenda starting on January 25, states that the extent of increase in the fortunes of the world’s top 10 richest people since the crisis began would be enough to prevent anyone in the world from falling into poverty because of the coronavirus, besides paying for a COVID-19 vaccine for all.

Oxfam’s survey of 295 economists from 79 countries, which was conducted between October 18 and November 16, 2020, and included doyens such as Jayati Ghosh, Jeffrey Sachs and Gabriel Zucman, also pointed to increasing inequality among populations across the globe. As many as 87 per cent of them believed income equality would rise in their respective countries owing to the pandemic, whereas 78 per cent of them thought wealth inequality would witness a likely increase. 

The wealth of billionaires, mostly White men, increased worldwide by $3.9 trillion between March 18 and December 31 last year, with their total wealth currently valued at $11.95 trillion said the Oxfam report. The world’s top 10 billionaires saw their wealth collectively increase by over $540 billion in the same period, despite a stock market collapse in the first few months of the pandemic reducing their wealth substantially. The report says that “unprecedented support from governments” had meant that stock markets were booming and driving up billionaire wealth, even as the real economy faced a deep recession . 

Meanwhile, those hit hardest by the COVID-19 crisis were the ones already living on the edge, with no financial support or resources to fall back on when the pandemic struck. According to the report, over three billion people worldwide had no access to health care. More than half of the workers in poor countries were living in poverty, whereas three-quarters of them did not get unemployment benefits or sick pay.

Gabriela Bucher, executive director of Oxfam International, said, “The deep divide between the rich and poor is proving as deadly as the virus. Rigged economies are funnelling wealth to a rich elite who are riding out the pandemic in luxury, while those on the frontline of the pandemic — shop assistants, health care workers, and market vendors — are struggling to pay the bills and put food on the table.”

In terms of gender equality, over half of the economists surveyed (56 per cent) predicted a rise. The report found that women were overrepresented in low-paid professions that bore the brunt of the pandemic, and that 112 million women would not be at a high risk of losing their jobs or incomes if they were represented at the same rate as men in these sectors. Women comprised close to 70 per cent of the world’s health and social care workforce, an essential but often poorly paid segment that was at greater risk from COVID-19.

Similarly, two thirds of the panel (66 per cent) thought the rise in racial inequality would be significant. The report said that Afro-descendants in Brazil were 40 per cent more likely to die of the virus than White people, while nearly 22,000 Black and Hispanic people in the United States would still be alive if they experienced the same COVID-19 mortality rates as their White counterparts.

“Women and marginalised racial and ethnic groups are bearing the brunt of this crisis. They are more likely to be pushed into poverty, more likely to go hungry, and more likely to be excluded from healthcare,” said Bucher.

Trust in governments was not resounding either, with 67 per cent saying that their country’s administration did not have a plan in place to mitigate the COVID-induced increase in inequality. Suggesting that fairer economies were the key to a rapid recovery, the report stated that a temporary tax on excess profits made by the 32 global corporations that gained most during the pandemic could have raised $104 billion last year – which could have provided unemployment benefits for all workers as well as financial support for all children and elderly people in poor countries.

Bucher added, “Extreme inequality is not inevitable, but a policy choice. Governments around the world must seize this opportunity to build more equal, more inclusive economies that end poverty and protect the planet.”