Owen's musings

This joint post with Alex Cobham was first published on Views from the Center.

In January, David Cameron nailed his colours to the mast with a speech in Davos that set out the three Ts agenda for the UK’s chairing of the June G8 meeting: taxes, trade and transparency. Since then, there has been much discussion of how serious the agenda is and what the G8 can actually deliver.

Will Cameron persuade the G-8 to take on tax evasion? 

There have also been some raised eyebrows among the cognoscenti about a fourth T: turf.  Some worry that a Cameron-led G8 effort might step on the toes of the G20 and its existing working groups, perhaps stimulating production of “not invented here” antibodies that would make it hard for the initiative to gain global traction.

We’ve been thinking about this issue, what G8 members should see properly as their collective responsibility, and what could be considered a success. Because the majority of the world’s cross-border financial services are provided by G8 members –even without including their satellite jurisdictions – progress on transparency at the G20 will be much more likely if the G8 members first get their own houses in order. Early action by the G8 should be welcomed by all concerned.

Still, we see two risks. The first is that G8 countries might introduce increased transparency within their home jurisdictions but be unwilling to apply the same higher standards to offshore secrecy jurisdictions (‘tax havens’) that are more or less directly under their influence (think Jersey or Cyprus, perhaps, or Cayman or Monaco). This would not only undermine the effectiveness of the initiative but cause outsiders – especially the non-G8 members of the G20 – to regard the entire effort with skepticism.

The second risk is that G8 countries might introduce arrangements but be unwilling to open these up to developing countries.  This would make it difficult for G8 members to claim that they were acting in a wider interest than their own narrow (and primarily fiscal) concerns. Apart from the lack of development progress entailed, it would likely make it much harder for the G8 to mobilise any subsequent progress from other secrecy jurisdictions such as Singapore to which illicit flows might gravitate.

Here’s a couple of pages outlining our thinking so far. To sharpen our thinking, we have written these as a draft  “Fermanagh Declaration” (in reference to the county of Northern Ireland where the G8 leaders will convene on 17-18 June). We would be delighted to receive comments, either below or directly by email (to europe@cgdev.org).

World Bank President Jim Kim joins the list of  leaders who have declared that ours is the generation which can end global poverty:

The world is at an auspicious moment. For the first time ever, we have a real opportunity to end extreme poverty within a generation. But achieving this goal won’t be easy.

Jim Kim, President of the World Bank, 17 April 2013

This amazing story of human progress shows what’s possible.
We can be the generation that eradicates absolute poverty in our world.

David Cameron, Speech to the World Economic Forum in Davos, 24 January 2013

For the first time in history, global economic prosperity, brought on by continuing scientific and technological progress and the self-reinforcing accumulation of wealth, has placed the world within reach of eliminating extreme poverty altogether.

Jeff Sachs, Can Extreme Poverty Be Eliminated?, Scientific American September 2005

You are right. We do have an historic opportunity this year to Make Poverty History.

Tony Blair, 16 April 2005, Campaign Diary

But in this new century, millions of people in the world’s poorest countries remain imprisoned, enslaved, and in chains. They are trapped in the prison of poverty. It is time to set them free.

… Sometimes it falls upon a generation to be great. You can be that great generation. Let your greatness blossom.

Nelson Mandela, Trafalgar Square, February 2005

It’s an amazing thing to think that ours is the first generation in history that really can end extreme poverty, the kind that means a child dies for lack of food in its belly. This should be seen as the most incredible, historic opportunity but instead it’s become a millstone around our necks. We let our own pathetic excuses about how it’s ‘difficult’ justify our own inaction. Let’s be honest. We have the science, the technology, and the wealth. What we don’t have is the will, and that’s not a reason that history will accept.

Bono in an interview to the World Association of Newspapers for World Press Freedom Day on May 3, 2004.

For the first time in human history, society has the capacity, the knowledge and the resources to eradicate poverty

Thabo Mbeki, President South Africa opening World Summit on Sustainable Development, Johannesburg, August 2002

in the new global economy we are, all of us, the richest countries and the poorest countries – inextricably bound to one another by common interests, shared needs and linked destinies; that what happens to the poorest citizen in the poorest country can directly affect the richest citizen in the richest country; and that not only do we have inescapable obligations beyond our front doors and garden gates, responsibilities beyond the city wall and duties beyond our national boundaries, but that this generation has it in our power - if it so chooses - to abolish all forms of human poverty.

Gordon Brown, speech to the Federal Reserve Bank, New York, 16 November 2001

The challenge is a huge one. But the prize is very great. We are the first generation in the whole of human history that has the chance to eradicate basic illiteracy from the human condition. And we can do this within fifteen years. Let’s resolve today – together – that we will do what needs to be done to make this happen.

Clare Short, UK Secretary of State for International Development, Speech to World Education Forum, Dakar, April 27, 2000

Hunger is man’s oldest enemy. There is now the scientific knowledge and the institutional arrangement that makes it possible to overcome hunger, not only within the United States but throughout the world. This can be done within the lifetime of people now living, if there is the political will to do so.

The Heritage Foundation, 1984

Mankind has never before had such ample technical and financial resources for coping with hunger and poverty. The immense task can be tackled once the necessary collective will is mobilized. What is necessary can be done, and must be done.

The Brandt Commission, North: South A Programme for Survival 1980

No child will go to bed hungry within ten years.

Henry Kissinger, First World Food Summit, Rome, 1974 

Because it is right, because it is wise, and because, for the first time in our history, it is possible to conquer poverty,

Lyndon B. Johnson’s Special Message to Congress, March 16, 1964

The world has been greatly changed, especially during the last century, by the discoveries of scientists. Our increased knowledge now provides the possibility of eliminating poverty and starvation, of decreasing significantly the suffering caused by disease, of using the resources of the world effectively for the benefit of humanity.

Linus Pauling – Nobel Lecture, December 11, 1963

Never before has man had such capacity to control his own environment, to end thirst and hunger, to conquer poverty and disease, to banish illiteracy and massive human misery. We have the power to make this the best generation of mankind in the history of the world–or to make it the last.

President John F. Kennedy, Address Before the 18th General Assembly of the United Nations, September 20, 1963

I have sworn before you and Almighty God the same solemn oath our forbears prescribed nearly a century and three-quarters ago. The world is very different now. For man holds in his mortal hands the power to abolish all forms of human poverty and all forms of human life. … To those people in the huts and villages of half the globe struggling to break the bonds of mass misery, we pledge our best efforts to help them help themselves, for whatever period is required–not because the communists may be doing it, not because we seek their votes, but because it is right. If a free society cannot help the many who are poor, it cannot save the few who are rich.

President John F. Kennedy, Inaugural Address, Washington, D.C., January 20, 1961.

More than half the people of the world are living in conditions approaching misery. …For the first time in history, humanity possesses the knowledge and the skill to relieve the suffering of these people.

Harry S Truman, Inaugural Address Given at Capitol Building, Washington, DC, Thursday, January 20, 1949

For the first time in history the counsels of mankind are to be drawn together and concerted for the purpose of defending the rights and improving the conditions of working people - men, women, and children – all over the world. Such a thing as that was never dreamed of before, and what you are asked to discuss in discussing the League of Nations is the matter of seeing that this thing is not interfered with.

Woodrow Wilson, League of Nations (8th September, 1919)

Every week my colleagues produce a wonderful round-up of development news which is sent out by email.  The latest edition is below.  If you want to receive the Europe Development Digest each week, you can sign up for it here. Please tick the box under ‘Europe Development Digest’ (eventually I’ll be able to direct you to a subscription page with that already ticked, but we haven’t set that up yet.)

Supported by the European Commission and seven EU member states, the newly-published European Report on Development (ERD) 2013 seeks to contribute to the global reflection on the post-2015 development agenda. It identifies development finance, trade and investment and labour migration as the three key potential drivers of a post-2015 global partnership and presents a series of policy recommendations for international collective action in a post-2015 agenda (and more specifically for the European Union).

  Five European states adopt multilateral measures to fight tax evasion

In a joint letter to the EU commission, the finance ministers of France, Germany, Italy, Spain, and the United Kingdom say they have agreed on a pilot project of multilateral automatic information exchange aimed at fighting tax evasion, reports the EUobserver. The initiative mirrors recently-adopted legislation in the United States requiring citizens to declare overseas bank accounts and foreign banks to notify the American tax authorities about their American clients. A similar EU-wide law has so far been held up by Austria and Luxembourg. Global Financial Integrity welcomes the initiative but urges rapid expansion to include developing countries.

World trade growth fell to 2.0% in 2012 – down from 5.2% in 2011 – and is expected to remain subdued in 2013 at around 3.3% as the economic slowdown in Europe continues to suppress global import demand, said the World Trade Organization . Speaking at a press conference held at the organisation’s Geneva headquarters, the Director-General Pascal Lamy said the recent slowdown shows that there is a need for more rules-based trade in order to reduce unemployment and to stimulate growth, adding that the threat of protectionism may be greater now than at any time since the start of the crisis, since other policies to restore growth have been tried and found wanting. Fair distribution is key to development

A white paper released by the Norwegian Ministry of International Development presents a range of new measures to be used in the fight against poverty. The white paper indicates that Norway will prioritise
partner countries working to reduce inequalities by strengthening tax systems, governance and civil society and promoting development that is sustainable and does not harm the environment. It calls on other donor countries to push this agenda at the United Nations and other multilateral fora, especially on issues such as tax evasion. The extent of offshore financial secrecy exposed

A cache of 2.5 million files obtained by the International Consortium of Investigative Journalists (ICIJ) revealed the secrets of more than 120,000 offshore companies and trusts and nearly 130,000 individuals and agents, mostly rooted in the British Virgin Islands, Singapore and the Cook Islands. CGD Research Fellow Alex Cobham has posted a blog that comments on the lack of transparency around corporate ownership.

Echoing tough legislation passed in the United States last year, European Union negotiators reached a deal on a law that will require firms operating in the extractive industries to declare – with no exemptions – payments made to foreign governments over 100,000 euros on a project-by-project basis, as part of efforts to end poverty in resource-rich nations. Advocacy groups, including the ONE campaign, welcomed the deal, although Oxfam and Eurodad expressed mixed feelings.

  Financing post-2015 goals in a changing development landscapeA new paper by the Overseas Development Institute explores options for financing potential post-2015 goals within the changing development cooperation landscape, focusing on five sectors: education, health, water and sanitation, sustainable energy and food and agriculture. In considering how to finance the estimated annual USD 26-50 billion (20-38 billion euro) funding gap for each sector, it concludes that government spending by developing country governments and Official Development Assistance will be critical, although innovative finance can go a long way if mechanisms can be scaled.