G20 Finance Ministers and Central Banks Meeting: Session I - The role of economic policies in addressing inequalities: National experiences and international cooperation
28 February 2024
Your excellencies,
The world suffers an excess of poverty and hunger due to an excess of inequality. This inequality is an indictment of an economic system that too often rewards the short-term over the long-term, and the zero-sum over the win-win.
Last week in Rio de Janeiro, in the G20 Foreign Ministers meeting, I spoke of a triple deficit – a deficit of growth (underpinned by weak international trade and investment), a deficit of trust (both within and among countries), and a deficit – finally – of hope. Inequality is at the core of that story.
National experiences remind us that addressing inequality is not simply an act of compassion, but an act of self-preservation. Unequal societies are fragile societies. They are societies where hope turns to despair, potential turns to resentment, and where shared prosperity turns to polarization and fragmentation.
Inequality is the reason we have lost resilience, the reason why the world has lost its capacity to recover from crises as one.
We must combat inequality at the national level and at the global level. At the national level, we must implement progressive taxation systems, invest in quality and universal education and healthcare systems, and have proactive productive policies that create the conditions for innovation and decent employment opportunities that diminish the insidious effects of informality. This, to name a few.
Yet, national efforts alone are not enough. We must acknowledge that the global rules underpinning the international economic system perpetuate asymmetries that stifle developing nations. We need policies that foster fair trade and investment that allow technology transfer and structural change for a green transition. We must recognize that a fraying global financial safety net can only lead to the fraying of all domestic safety nets, especially in a world of global systemic shocks that have increased inequalities between and within countries.
Your excellencies, there is much more that we can do with the resources we have. This is about lacking resources; it's about priorities. Inaction is a choice.
Thank you.
