G20 Faces Pressure to Tackle Global inequality & Debt Crisis
As the G20 summit convenes amidst significant global challenges, calls are mounting for decisive action on escalating inequality and a worsening debt crisis in low-income countries. South Africa is leading the charge, advocating for the establishment of an International Panel on Inequality, based on recommendations from the Stiglitz report, and seeking support from fellow G20 nations.
The urgency stems from a stark disparity in wealth distribution. Oxfam highlights that G20 billionaires collectively hold $15.6 trillion, a figure they describe as an “open secret” demanding fairer taxation to address poverty and climate change. Oxfam International Executive Director Amitabh Behar argues that inequality isn’t accidental, but a “intentional policy choice” leading to stagnating public wealth, growing debt distress, and eroded opportunities for the majority.
The absence of the united States from key meetings presents an possibility for other G20 countries to champion policies that prioritize ordinary citizens over the world’s wealthiest individuals. Critics point to recent U.S. policies – including tariffs, tax breaks for the wealthy, and cuts to aid – as exacerbating inequality both domestically and internationally. Specifically, the U.S. has withdrawn from international tax cooperation and attempted to undermine a global corporate minimum tax agreement.
Oxfam is urging G20 leaders to revitalize a commitment made at last year’s Brazilian G20 summit to effectively tax the super-rich, noting that wealth taxes currently contribute only eight cents for every dollar collected in G20 countries.
Beyond taxation, the association is also sounding the alarm on a looming debt crisis. The IMF reports that over half of all low-income countries are either in, or at high risk of, debt distress, diverting crucial funds from essential services like education and healthcare. Currently, 3.4 billion people reside in countries where debt repayment exceeds spending on education and health, effectively representing a “default on progress” according to Behar.
though, existing G20 debt relief initiatives are falling short. Oxfam reports that only four out of 69 eligible countries have applied for assistance under the current scheme,due to it’s slow implementation and limited scope.This has created a cycle where countries, facing increased default risk, are forced to rely on loans from institutions like the IMF and World Bank, frequently enough accompanied by stringent conditions that include austerity measures and limited debt relief.
