The richest 1 per cent now have more wealth than the rest of the world. Photo: Bloomberg
Just 62 people own as much wealth as the poorer half of the global population, a new report reveals, as the widening of the gap between the rich and poor accelerates.
As the business elite converge on Davos for the World Economic Forum, an Oxfam report shows wealth is becoming further concentrated, with the number of people owning the same amount as the bottom half of humanity falling from 388 to 62 in five years.
It says a “broken” economic model underpinned by deregulation, privatisation and financial secrecy has seen the wealth of the richest 62 people jump by 44 per cent in five years to $1.76 trillion.
In that time, the wealth of the poorest 3.6 billion people plunged by 41 per cent.
“The big winners in our global economy are those at the top. Our economic system is heavily skewed in their favour. Far from trickling down, income and wealth are instead being sucked upwards at an alarming rate,” the report said.
Oxfam acknowledged that efforts to tackle inequality had seen the halving of the number of people living below the extreme poverty line between 1990 and 2010.
”Yet had inequality within countries not grown during that period, an extra 200 million people would have escaped poverty. That could have risen to 700 million had poor people benefited more than the rich from economic growth,” it said.
Oxfam said the growing problem of tax avoidance and use of tax havens was a prime example of how the economic system was “rigged” in the rich’s favour and must be stopped.
It is also calling for workers to be paid a living wage rather than the minimum, for the end of the gender pay gap, for the influence of the powerful with vested interests to be kept in check, and for the tax burden to be shifted away from labour and consumption and towards wealth and capital.
Since the turn of the century, the world’s bottom half has received 1 per cent of the total increase in global wealth, while half of that increase has gone to the top 1 per cent, it also said.
For those comfortably living in Australia, it referred to a Credit Suisse study that revealed the richest 1 per cent now have more than the rest of the world. This occurred a year earlier than predicted.
So much of the world remains relatively poor that it has taken a net worth of just $4400 in 2015 to be counted among the wealthiest half of all world citizens, the study found.
Oxfam Australia’s chief executive Helen Szoke said Australia was “dragging its feet” when it came to stamping out tax dodging.
“Australian multinational companies, and those that operate here, should be required to publish their profits and taxes paid in every country in which they operate,” she said.
“Action to recover the missing billions lost to tax havens needs to be accompanied by a commitment by governments to invest in healthcare, schools and other vital public services that make such a big difference to the lives of the poorest people.”
A senate inquiry into corporate tax avoidance is due to deliver its report at the end of February. Tax Office data showed some tech companies such as Apple and Google are paying little or no tax in Australia.
The three richest men in the world – software mogul Bill Gates, Mexican telecom magnate Carlos Slim Helu and investor WarrenBuffett – have a combined net worth of $230 billion, according to Forbes.
In China, the richest 1 per cent of households own one-third of the country’s wealth, while the bottom 25 per cent account for only 1 per cent, a new report by Peking University researchers showed.
And in Britain, new data revealed growing house prices has led to the top 10 per cent now owning nearly half of the country’s total private wealth.
The International Monetary Fund last year warned the gap between rich and poor in advanced economies was now at its highest level in decades, making widening income inequality the “defining challenge of our time” and suggesting “the benefits do not trickle down”.