Governments can finance critical action on extreme poverty, COVID-19 and the climate crisis and by recovering the billions of dollars lost through tax abuse, corruption and money-laundering, says a UN panel.
The High-Level Panel on International Financial Accountability, Transparency and Integrity for Achieving the 2030 Agenda (FACTI Panel) is calling on governments to agree to a Global Pact for Financial Integrity for Sustainable Development.
The panel of former world leaders and central bank governors, business and civil society heads and academics says as much as 2.7% of the global GDP is laundered annually, while corporations shopping around for tax-free jurisdictions cost governments up to $600 billion a year.
In its report, Financial Integrity for Sustainable Development, the FACTI Panel says stronger laws and institutions are needed to prevent corruption and money laundering, and that the bankers, lawyers and accountants who enable financial crime must also face punitive sanctions.
The report also calls for greater transparency around company ownership and public spending, stronger international cooperation to prosecute bribery, international minimum corporate tax and the taxing of digital giants, and global governance of tax abuse and money-laundering.
“A corrupt and failing financial system robs the poor and deprives the whole world of the resources needed to eradicate poverty, recover from COVID and tackle the climate crisis,” says Dalia Grybauskaitė, FACTI co-chair and former president of Lithuania.
“Closing loopholes that allow money laundering, corruption and tax abuse and stopping wrongdoing by bankers, accountants and lawyers are steps in transforming the global economy for the universal good,” says Ibrahim Mayaki, FACTI co-chair and former prime minister of Niger.
At a time when billionaires’ wealth soared by 27.5% while 131 million people were pushed into poverty due to COVID-19, the report says that a tenth of the world’s wealth could be hidden in offshore financial assets, preventing governments from collecting their fair share of taxes.
Recovering the annual loss to tax avoidance and evasion in Bangladesh for example would allow the country to expand its social safety net to 9 million more elderly, in Chad it could pay for 38,000 classrooms, and in Germany it could build 8,000 wind turbines.
The High-Level Panel on International Financial Accountability, Transparency and Integrity for Achieving the 2030 Agenda (FACTI Panel) was convened by the 74th President of the United Nations General Assembly and the 75th President of the Economic and Social Council on 2 March 2020.
The FACTI Panel reviews financial accountability, transparency and integrity, and makes evidence-based recommendations to close remaining gaps in the international system as a means to achieve the 2030 Agenda and the Sustainable Development Goals.
Please visit the FACTI Panel and sign up for alerts: factipanel.org
Follow us on Twitter: @FACTIPanel
EU needs to reinvent itself to win fight against poverty - UN expert
The European Union must boldly rethink its socio-economic governance if it is to live up to its commitment to eradicate poverty, the UN Special Rapporteur on extreme poverty and human rights said at the end of an official visit to the EU’s institutions on Friday (29 January).
“While the EU has made recent progress in the eradication of poverty, it should not fall into complacency,” said Olivier De Schutter (pictured). “Its own commitment to lift 20 million people out of poverty by 2020 was largely missed. Since the EU has experienced steady economic and employment growth until very recently, the only explanation for this failure is that the benefits have not been evenly distributed. This is a defeat for social rights.”
One in five people, or 21.1% of the population, was at risk of poverty or social exclusion in 2019: this represents a total of 92.4 million people. A total of 19.4 million children, representing 23.1%, live in poverty across the Union, and 20.4 million workers live at risk of poverty. Women are disproportionately represented among the poor. Eight-five percent of lone-parent families are led by women, and 40.3 percent of them are at risk of poverty.
The crisis triggered by the COVID-19 has affected many Europeans who had never experienced poverty before. “I have spoken with people who have experienced hunger for the first time, who have been exposed because they are homeless, and who are maltreated and abused because of poverty,” said De Schutter.
“The EU can play an important role in galvanizing Member States' anti-poverty efforts, notably through the yearly recommendations it issues to its Member States. But instead of prioritizing investments in healthcare, education, and social protection, these recommendations have often imposed budgetary cuts in the name of cost-efficiency. Since 2009, member states have only decreased their investments in these areas critical for poverty reduction,” the UN expert noted.
The European Green Deal was presented at the end of 2019 by President von der Leyen as the new EU growth strategy. “The fight against poverty is the missing piece of this Green Deal. The Green Deal is supposed to combine environmental and social objectives, but as long as this good intention is not translated into concrete actions, millions will continue to struggle for a decent standard of living in a society that leaves them behind.”
De Schutter also highlighted that the inability of the EU to address the "race to the bottom” of member states in the fields of taxation and worker protections undermines its anti-poverty efforts.
“Member states compete with each other in very unhelpful ways. They race to the bottom by lowering taxes, wages, and worker protections because they think that's how they can attract investors and improve external cost competitiveness. But undermining social rights not only violates international obligations, it is bad for enterprises, workers, and public coffers alike. Between €160-190 billion are lost each year from tax competition alone. This results in shifting the tax burden from large corporations and wealthy individuals onto workers and consumers.”
From 25 November to 28 January, the UN expert met with representatives from institutions such as the European Commission, the Council of the EU, the European Parliament, the European Labor Authority, the European Economic and Social Committee, the Fundamental Rights Agency, the European Central Bank and the European Investment Bank, as well as national or local representatives from France, Spain, Italy, and Romania. He spoke with numerous civil society organisations representing younger and older adults, Roma populations, migrants, children, people with disabilities, as well as with people affected by poverty across these groups, and with social workers and social partners.
“I was impressed by the dedication of the officials with whom I met," De Schutter said. "But goodwill is not enough. If Europe wants to lead the way towards inclusive societies, it needs a bold EU-wide anti-poverty strategy that commits to reducing poverty by 50 percent equally across Member States by 2030.
“The current crisis is the chance for Europe to reinvent itself by placing social justice at its core. The presentation of the Action Plan to implement the European Pillar of Social Rights, which should include the Child Guarantee and a proposal to ensure adequate minimum incomes schemes are available across the EU, is an opportunity that should not be wasted."
The final report from the expert’s visit will be presented to the UN Human Rights Council in Geneva in June 2021.
The end-of-mission statement is here.
The list of meetings held is here.
Olivier De Schutter was appointed as the UN Special Rapporteur on extreme poverty and human rights by the UN Human Rights Council on 1st May 2020. The Special Rapporteurs are part of what is known as theSpecial Procedures of the Human Rights Council. Special Procedures, the largest body of independent experts in the UN Human Rights system, is the general name of the Council's independent fact-finding and monitoring mechanisms that address either specific country situations or thematic issues in all parts of the world. Special Procedures experts work on a voluntary basis; they are not UN staff and do not receive a salary for their work. They are independent from any government or organisation and serve in their individual capacity.
The undetermined impact of COVID-19 on the UN Sustainable Development Goals
The COVID-19 pandemic has fractured the normality of society. However, an opportunity that may rise from the ashes of this pandemic is a reset to surpass the United Nations Sustainable Development Goals - writes Kevin Butler, a Brussels based public affairs specialist.
In 2015, the United Nations set out an interlinked collection of 17 goals as a “blueprint to achieve a better and more sustainable future for all.” September 2020 is the fifth anniversary of their adoption. With just under ten years left to achieve the Sustainable Development Goals, world leaders at an SDG Summit in 2019 called for a Decade of Action and delivery for sustainable development. They pledged to mobilize financing, enhance national implementation and strengthen institutions to achieve the Goals by the target date of 2030, leaving no one behind. Despite recent progress towards the Goals, the pandemic has shifted this momentum.
Impact of COVID-19 on the SDGs
The United Nations predicts the COVID-19 pandemic will send an estimated 71 million people into extreme poverty, the first rise in global poverty since 1998. Underemployment and unemployment means some 1.6 billion already vulnerable workers in the informal economy (half the global workforce) may be significantly affected, with their incomes estimated to have fallen by 60 per cent in the first month of the crisis alone.
Women and children are also among those bearing the heaviest brunt of the pandemic’s effects. Decreased health and vaccination services along with limited access to diet and nutrition services have the potential to cause hundreds of thousands of additional under-five deaths and tens of thousands of additional maternal deaths across the world in 2020. Many countries have also seen a surge in reports of domestic violence against women and children.
School closures have kept 90% of students worldwide (1.57 billion) out of school and caused over 370 million children to miss out on school meals they depend on. Lack of access to computers and the internet at home means remote learning is out of reach for many people. As more families fall into extreme poverty, children in poor and disadvantaged communities are at much greater risk of child labour, child marriage and child trafficking. Research shows that the global gains in reducing child labour are likely to be reversed for the first time in 20 years.
An opportunity to reset
No matter how powerful the impact of COVID-19 is, we have an opportunity to hit the reset button. Once we are able to rebuild, we must ensure the success of our economy will also reflect societal well-being within each country. We have a unique window of opportunity to shape the recovery. New foundations must be built for our economic and social systems – one that ensures equality for all. Undoubtedly, the level of ambition and cooperation are key metrics in delivering these political objectives. However, we have seen in the past couple of months that radical change can happen overnight.
Organisations and governments have adapted during the crisis, working from home, engaging in virtual conferences and a wide list of the traditional norms for society have simply ceased to exist. Additionally, populations have also adapted in order to stop the spread of the virus.
Notable figures have called for wide ranging changes to the normal that we were once used to fro many years. A few weeks ago, UN Messenger of Peace Malala Yousafzai pleaded to world leaders that “things should not return to the way they were”, insisting on action rather than words. Achim Steiner, former executive director at UNEP recently stated that “the pandemic is a clear warning. Recovery from the crisis cannot be driven by a zero-sum game of economy versus environment, or health versus economy” He called this a “once in a generation chance to set things straight”.
The influence of the SDGs on Europe
The triple effect of the pandemic as seen above, will, in the short term, work against the goals of the UN SDGs. However, it is clear now that the SDGs are resilience indicators for the future.
The Von der Leyen Commission is geared towards a Green and Digital Union since the beginning of her term. The leading figure under the Commission President is Frans Timmermans, Executive Vice President for the EU Green Deal which is one of the six core pillars of the Von der Leyen Commission. In recent months, the European Commission has been building back towards a Green and Digital recovery. A key part of this recovery is the implementation of the principle known as ‘repair and prepare for the next generation.’
Despite the positive communications and policies over the past number of months, more action is needed. Certain countries are building wellbeing indicators into their budgets. The Finnish Presidency in 2019 pushed for more action at an EU level through their Economy of Wellbeing Council conclusions and the Italian government run simulations on budget policies to see if a number of societal indicators would be improved.
Last chance for change
Actions speak louder than words. The pandemic has created enormous short term difficulties for our society. Despite the challenges, we must rebuild. The inequalities of the pre-pandemic world cannot be repeated. Over the past number of months in particular, we have seen how wide the gap is between rich and poor. The European Commission has acted in response to the pandemic but a stronger Europe in the world is needed to successfully realize the UN SDGs.
Civil society leaders and organizations have called for a “super year of activism” to accelerate progress on SDG’s, urging world leaders to increase efforts to reach everyone by supporting local action and innovation and unlocking more financing for sustainable development. Without change, the activism of Fridays for Future and other local level action will increase and intensify throughout the world. This action has the ability to change the current political system with a Green Wave 2.0.
#Pompeo warns #Russia and #China against ignoring move to reimpose UN sanctions on #Iran
Pompeo will meet with Indonesia’s U.N. Ambassador Dian Triansyah Djani - council president for August - to submit a complaint about Iran’s non-compliance with a 2015 nuclear deal, even though Washington quit the accord in 2018.
The nuclear deal between Iran, Russia, China, Germany, Britain, France and the United States aimed to prevent Tehran from developing nuclear weapons in return for sanctions relief. That accord is enshrined in a 2015 Security Council resolution.
In response to what the United States calls its “maximum pressure” campaign of unilateral sanctions - a bid to get Iran to negotiate a new deal - Tehran has breached central limits of the 2015 pact, including on its stock of enriched uranium.
Diplomats say the so-called sanctions snapback process will be messy as Russia, China and other countries question the legality of the U.S. move given that Washington itself is no longer complying with what Trump called the “worst deal ever.”
Given questions over the US move, diplomats said Russia, China and other countries are likely to simply ignore it and not reimpose the sanctions on Iran.
When asked if the United States would target Russia and China with sanctions if they refuse to reimpose the UN measures on Iran, Pompeo told Fox News on Wednesday (19 August): “Absolutely.”
“We have already done that, where we have seen any country violate ... the current American sanctions, we’ve held every nation accountable for that. We’ll do the same thing with respect to the broader UN Security Council sanctions as well,” he said.
The United States had threatened to use the sanctions snapback provision in the nuclear deal after it lost a bid in the Security Council last Friday (14 August) to extend an arms embargo on Tehran, which is due to expire in October.
Pompeo said it was unfortunate that the European members of the council abstained on the U.S. attempt to extend the arms embargo and that the move “makes the European people less safe”.
“They just are wedded to this crazy nuclear deal, they’re trying to hang on to it,” he said.
Once Pompeo submits the complaint about Iran to the Security Council, the body has 30 days to adopt a resolution to extend sanctions relief for Tehran or else the measures will automatically snap back. Any attempt to extend the sanctions relief would be vetoed by the United States.
Pompeo also met with UN Secretary-General Antonio Guterres on Thursday.
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