Reforming global tax rules and curbing illicit financial flows could provide desperately needed resources to developing countries seeking to counter dwindling donor support, UNAids executive director Winnie Byanyima told the World Health Summit on Sunday.
Charting a response to US President Donald Trump’s abrupt cuts to foreign aid and a sharp decline in donor assistance from many European countries is a central theme of the conference, under way in Berlin.
“We need global tax loopholes to be closed, and for countries to tax more progressively,” said Byanyima, a member of the G20 expert committee appointed by President Cyril Ramaphosa to tackle global wealth inequality. The task force, chaired by Nobel prize winning economist Joseph Stiglitz, is expected to present its findings to G20 world leaders when they convene in Johannesburg in November.
Greater tax transparency
Byanyima called for greater tax transparency and a global agreement on a minimum tax threshold for billionaires. “If the world [were] to tax the top 3,000 billionaires [by an additional 2%], the world could raise $1.7-trillion … [which] would fund health, climate adaptation and education [programmes],” she said.
Forcing billionaires to pay more tax would also reduce reliance on philanthropists and give governments a greater say over which initiatives to fund, she said.
Global health has been anchored in global solidarity, driven by aid for developing countries. Now we are seeing that aid tumbling very fast.
— Winnie Byanyima
UNAids executive director
The UN has been pushing for reforms to tackle base erosion and profit-shifting activities by multinational companies, which have particularly severe impacts on low and middle income countries. It also wants to see global collaboration to counter illegal cross-border movements of money, known as illicit financial flows, which include commercial and criminal activities.
Africa lost an estimated $88.6bn to illicit financial flows in 2020, equivalent to 3.7% of the continent’s GDP according to the UN Conference on Trade and Development (Unctad). It found African nations with high illicit financial flows spent on average 25% less on health and 58% less on education compared with countries with low illicit financial flows.
Byanyima also made a plea for an “orderly, responsible and planned” retreat by countries scaling back on foreign aid to developing countries. She acknowledged there were problems with the current system, which had led to an overreliance on a handful of donors, but urged donor nations to proceed cautiously.
“Global health has been anchored in global solidarity, driven by aid for developing countries. Now we are seeing that aid tumbling very fast. That rapid decline is costing lives,” she said.
Her remarks about the dangers of a rapid reduction in donor aid come hard on the heels of a proposal from UN secretary-general António Guterres to wind down Unaids by end-2026. The joint UN agency on HIV/Aids had previously said it was considering sunsetting its activities by end-2030.
Disclaimer: Kahn’s travel to the World Health Summit was sponsored by Vital Strategies.
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