Global Policy Forum

Globalization Driving Inequality, UN Warns


By Haider Rizvi

Inter Press Service
August 26, 2005

Despite unprecedented economic growth in recent years, the rich have become richer and the poor even poorer, says a new U.N. report that also shows women facing more hardship than men in all walks of life.

The report, titled "The World Social Situation: The Inequality Predicament," was issued Thursday just three weeks ahead of a major world summit called by U.N. Secretary-General Kofi Annan to address the pressing issues of global poverty, hunger, disease and illiteracy.

Sounding the alarm over "persistent and deepening" inequality, the authors focus on the chasm between the formal and informal economies, the widening gap between skilled and unskilled workers, the growing disparities in health and education, and opportunities for social, economic and political participation.

The world is more polarised today than it was 10 years ago, says the report, which calls for a deeper commitment to keeping the pledges made by world leaders at the Summit for Social Development held in the Danish capital of Copenhagen in 1995. At that meeting, they promised to confront profound social challenges and place people at the centre of development.

"But (since then) some decades-old social gaps have actually widened, particularly gender disparities," Jose Antonio Ocampo, under-secretary-general of the U.N. Department of Economic and Social Affairs, told reporters as he introduced the report.

Noting that one of the "most pervasive" forms of inequality is gender discrimination, Ocampo noted that about 60 percent of the world's informal workers, who lack legal protections, are women. "That's a very hard proportion given the fact that women have a lower level of labour force participation than men," he said.

Although more women and girls are being educated, formal employment figures for women have stagnated or even decreased in some parts of the world, he said, describing the sharp increase of women in the informal sector as "even more troubling."

The 158-page study shows that inequality between and within countries has often accompanied greater economic globalisation. These inequalities have had negative consequences in many areas, including employment, job security and wages.

"Ignoring inequality in the pursuit of development is perilous," the report warns. "Focusing exclusively on economic growth and income generation as a development strategy is ineffective, as it leads to the accumulation of wealth by a few and deepens the poverty of many."

The authors note that in a world of increasing technological development, when societies should be benefiting from economic progress, many are facing "alarming increases" in the discrepancies between rich and poor.

Even comparatively wealthy nations like the United States, Canada and Britain have failed to escape this trend. And while China and India have seen considerable economic growth, the two largest Asian nations have also failed to address the issue of inequality.

Similar patterns are found in the distribution of wealth elsewhere in Asia, Latin America and Africa. The report says that in sub-Saharan Africa alone, the number of poor people increased by almost 90 million in little more than a decade (from 1990 to 2001).

In Latin America, unemployment rose from nearly seven percent in 1995 to nine percent in 2002, with many workers forced to turn to the informal sector, where conditions are "often inhumane and the wages are low".

The report suggests that in countries like Brazil, Guatemala and Bolivia, race and ethnicity continues to be a main determinant of economic opportunities. Indigenous and Afro-descendant populations earn an average of 35 to 65 percent less than white men, and are much less likely to have access to education and housing, the report says.

Regarding solutions to inequality, the report stresses the need to adjust the economic imbalances not just within nations, but also among them, noting that 80 percent of the world's domestic product belongs to one billion people living in the industrially developed world, while the remaining 20 percent is shared by five billion people living in developing countries.

Worried about the slow pace of progress towards the Millennium Development Goals (MDGs), Annan has repeatedly urged wealthy nations to fulfill their pledge of giving at least 0.7 percent of gross national income for development in poor countries.

This issue is also highlighted in the draft document for the September Summit, but the United States has expressed strong reservations.

In fact, the United States recently introduced more than 750 amendments that would eliminate new pledges of foreign aid to poor countries, instead focusing on issues such as terrorism and security.

The eight MDGs include a 50 percent reduction in poverty and hunger; universal primary education; reduction of child mortality by two-thirds; cutbacks in maternal mortality by three-quarters; the promotion of gender equality; environmental sustainability; reversal of the spread of HIV/AIDS, malaria and other diseases; and a global partnership for development between the rich and poor -- all by 2015.

"The U.S. government calls for striking any mention of the MDGs, and the administration has publicly complained that the document's section on poverty is too long," according to the Washington Post, which obtained the text of Washington's proposals this week.

In their report, U.N. researchers also argue that the growing schism between the "haves" and "have-nots" poses a major threat to democracies around the world, and will breed further violence and terror if the trend is not reversed.

In his remarks, Ocampo warned the world community of the consequences of inaction.

"Failure to address this inequality predicament will insure that social injustice and better living conditions for all people remain elusive," he said, adding that it would lead to further social instability in the world, "for which every one will have to pay the price".

More Information on Social and Economic Policy
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