by Kunal Dutta
The combined wealth of the world’s richest 1% will overtake that of the remaining 99% by 2016 unless action is taken to curb “shocking extremes” of inequality, a new report warns.
The richest 1% currently own 48% of all global wealth, Oxfam says. Next year that figure is forecast to exceed 50% for the first time.
Using data from Credit Suisse’s latest global wealth report, the charity warns that rising inequality is holding back the fight against global poverty at a time when more than a billion people still live on less than US$1.25 a day.
The report warns that global wealth “is becoming increasing concentrated among a small, wealthy elite”.
The richest 1 per cent include US investor Warren Buffett, former New York mayor Michael Bloomberg and Indian businessman Dilip Shanghvi. Those in the “1 per cent” command an average wealth of US$2.7 million per adult.
The report is released today ahead of the World Economic Forum in Davos.
Oxfam will use the summit in Switzerland to call for new measures to tackle global inequality, including a clampdown on tax evasion and a living wage for all workers.
Winnie Byanyima, executive director of Oxfam International, said: “The scale of global inequality is quite simply staggering, and despite the issues shooting up the global agenda, the gap between the richest and the rest is widening fast. Failure to tackle inequality will set the fight against poverty back decades.
“The poor are hurt twice by rising inequality – they get a smaller share of the economic pie and because extreme inequality hurts growth, there is less pie to be shared around.”
Lynn Forester de Rothschild, chief executive of E L Rothschild, said: “Extreme inequality undermines economic growth and it threatens the private sector’s bottom line.
“All those gathering at Davos who want a stable and prosperous world should make tackling inequality a top priority.”
Oxfam research shows that 20% of billionaires have interests in the financial and insurance sectors, a group which saw their cash wealth increase by 11% in the 12 months to March 2014.
The charity made headlines at Davos last year with the revelation that the world’s 85 richest people were as wealthy as the poorest 50%. This year, it claims that number has shrunk to 80 as the world becomes more unequal.