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Oxfam: 2.7 billion saw no state aid during COVID crisis

Alex Berry
December 15, 2020

A new Oxfam report has revealed that around a third of the world's population has had no state assistance during the coronavirus pandemic. It noted huge gaps between rich and poor countries.

Residents of a slum in New Delhi
Many were left without income or social support following the sudden imposition of lockdowns earlier in the yearImage: Getty Images/Y. Nazir

Global economic inequality has caused poverty and hunger to soar during the coronavirus crisis, Oxfam said in a report published on Tuesday.

The "Shelter from the Storm" report highlighted the chasm between richer and poorer countries in both how they were affected by the crisis and their means to deal with it.

Half a billion people are now underemployed out of work, with women and people from low-income countries worst hit.

COVID-19, the great unequalizer

Of the $11.7 trillion (€9.62 trillion) spent in 2020 in state aid and support for those affected by the outbreak and the subsequent lockdowns, 83% — some $9.8 trillion — was spent by 36 rich countries in comparison to just 0.4% — or $4.2 billion — spent by 59 poorer countries.

How did this global failure happen?

"The coronavirus united the world in fear but has divided it in response," said Oxfam Executive Director Gabriela Bucher. "The pandemic sparked a laudable global effort that reached more than a billion more people with social protection support over 2020 but, as of today, more people still have been left behind entirely. That need not be so."

The report laid the blame on countries that failed to invest in social safety networks prior to the crisis and pointed out how certain lower-income countries such as South Africa, Namibia and Bolivia fared better because of near-universal social benefits.

Without the necessary investment, over a third of the world's population received no government aid to cope with the crisis.

Oxfam also called out rich countries for failing to show solidarity in the face of the global crisis. Foreign aid only increased by $5.8 billion for social protection, the equivalent of less than 5 cents for every $100 raised as a whole to deal with the fallout of the COVID-19 pandemic.

How can this crisis be overcome?

Inequality has only been exacerbated by the pandemic, with 28 of the richest countries reviewed by Oxfam spending $695 per person for social programs. Meanwhile, low-income and emerging countries managed a per capita spending of between $28 to as low as $4.

Bucher considered this inequality an outcome of the global economic system, saying: "All this because inequality is a hard-wired design feature rather than design fault of our global economic system. Millions of desperate people see precious little relief ahead without urgent action."

The report called for the world's richer economies to make greater contributions to fighting global poverty, especially at this time, urging governments to spend a further 2% of their GDP to tackle the social consequences of the pandemic.

"There is still time for developing country governments to step up their support for people by increasing taxes on the richest to pay for decent universal social protection programs. They have to show the will. And [there is] still time for rich nations to increase their aid and cancel their debts, to help them afford it."

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