Bill Gates backs financial transaction tax to aid poor
By Lesley Wroughton
WASHINGTON (Reuters) - A report by Microsoft founder Bill Gates to Group of 20 ministers on Friday proposes raising new funding for poorer countries by taxing financial transactions, tobacco, and shipping and aviation fuels, according to details of a G20 report obtained by Reuters.
The Gates Foundation was tasked by current G20 chair, France, to look at how the governments of its member countries could raise new money for aid to developing nations, including plugging an estimated $80-100 billion funding gap to help the poor adapt to climate change.
With traditional Western donors in Europe and the United States under pressure to cut their budgets, developing nations are looking at news ways to raise resources to develop their growing economies.
Gates' point, according to a draft technical note on the report, is that if African countries can maintain current average growth rates, their economies will double in size by early next decade and gross domestic product per capital will rise by more than 50 percent.
While countries in Africa are looking increasingly toward China and India for support, there is also pressure on Western donors to keep their commitments to aid impoverished nations.
World Bank President Robert Zoellick this week warned that the European crisis was already affecting developing economies through declining demand. He said budgets of poor countries have not yet fully recovered from the double shock of the 2008 global financial crisis and a food price crisis.
He said more than 40 percent of developing nations now have government deficits in excess of 4 percent of GDP.
South African Finance Minister Pravin Gordhan said there was rising concern among policymakers in developing economies about the escalating crisis in Europe and how it could impact their economies. Continued...