Davos warning: World's 85 richest people have as much as half the rest of us
Published 20/01/2014 | 08:51
The 85 richest people on the planet have accumulated as much wealth between them as half of the world’s population, political and financial leaders have been warned ahead of their annual gathering in the Swiss resort of Davos.
The tiny elite of multibillionaires, who could fit into a double-decker bus, have piled up fortunes equivalent to the wealth of the world’s poorest 3.5bn people, according to a new analysis by Oxfam. The charity condemned the “pernicious” impact of the steadily growing gap between a small group of the super-rich and hundreds of millions of their fellow citizens, arguing it could trigger social unrest.
It released the research on the eve of the World Economic Forum, starting on Wednesday, which brings together many of the most influential figures in international trade, business, finance and politics including David Cameron and George Osborne. Disparities in income and wealth will be high on its agenda, along with driving up international health standards and mitigating the impact of climate change.
Oxfam said the world’s richest 85 people boast a collective worth of $1.7trn (£1trn). Top of the pile is Carlos Slim Helu, the Mexican telecommunications mogul, whose family’s net wealth is estimated by Forbes business magazine at $73bn. He is followed by Bill Gates, the Microsoft founder and philanthropist, whose worth is put at $67bn and is one of 31 Americans on the list.
Other well known names include the business magnate Warren Buffett, whose estimated worth is $53.5bn, and Larry Page, the co-founder of Google, with $23bn.
The world’s richest woman, Liliane Bettencourt, sits on a family fortune of $30bn derived from L’Oréal, the cosmetics company. According to Forbes, the richest person in the UK (and 89th in the world) is the Duke of Westminster, whose property empire has boosted his wealth to $11.4bn.
Oxfam calculated that almost half the world’s wealth – $110trn – is owned by just 1 per cent of its population. It said that 70 per cent of people live in countries where the gap between the rich and poor has widened in the last 30 years.
“This massive concentration of economic resources in the hands of fewer people presents a significant threat to inclusive political and economic systems,” the charity said. “People are increasingly separated by economic and political power, inevitably heightening social tensions and increasing the risk of societal breakdown.”
Winnie Byanyima, Oxfam’s executive director, who will attend Davos, described the gulf between sectors of society as staggering. “We cannot hope to win the fight against poverty without tackling inequality. Widening inequality is creating a vicious circle where wealth and power are increasingly concentrated in the hands of a few, leaving the rest of us to fight over crumbs from the top table,” she said.
Oxfam is calling on the business chiefs gathering at Davos to promise to support progressive taxation and not dodge their own taxes, refrain from using their wealth to seek political favours and demand that companies they own or control pay a living wage. In a report last week the forum warned that income disparity leading to social unrest could have a significant impact on the world economy over the next 12 months.
There was a “lost” generation of young people coming of age who lacked jobs and the skills for work, the report said. This could easily boil over into protests over inequality and corruption. Jennifer Blanke, the forum’s chief economist, said: “Disgruntlement can lead to the dissolution of the fabric of society, especially if young people feel they don’t have a future. This is something that affects everybody.”
Stagnation, jobless growth and deflation will be among topics debated at the World Economic Forum in the Swiss resort of Davos this week. Elites from politics, business and academia will gather with the international economic backdrop looking rosier than in many years.
Nevertheless, Christine Lagarde, right, head of the International Monetary Fund, is expected to repeat her warning that advanced countries are flirting with deflation. “If inflation is the genie, then deflation is the ogre that must be fought decisively,” she said in Washington, referring to a recent dip in eurozone annual inflation to just 0.8 per cent.
The response from the president of the European Central Bank, Mario Draghi, with whom she will share a panel at Davos, will be watched closely.