'Restructuring global economy' urged to address widening inequality

JOHANNESBURG - A charity group leader based in South Africa on Monday called for a restructuring of the global economy to address widening inequality in the world.

"The problem of inequality is because of broken economies," Siphokazi Mthathi, executive director of Oxfam South Africa, told Xinhua. "There is a need to restructure the global economy to be the people's economy."

Oxfam released its annual global inequailty report on Monday, saying the richest 1 percent bagged 82 percent of wealth created in 2017, while the 3.7 billion people who make up the poorest half of the world saw no increase in their wealth.

The report, titled "Reward Work, Not Wealth," stated that the rise in inequality was caused by the erosion of the workers' rights, cost reduction, tax evasion and companies' influence on policy.

In South Africa there is also a serious challenge of poverty, inequality and unemployment, Mthathi said.

"We have to change the rules of the game," she said. "One of the biggest problems is that the money is used to exert policy decision in the US, Brazil, India and South Africa by the super-rich and corporations."

Oxfam said governments should tackle tax evasion and control shareholder returns in some companies; they also need to tackle tax avoidance and put limits on shareholder returns and executive pay.

"Profits to shareholders should be minimized to benefit those who create wealth. In the last 12 months, the few super rich's wealth increased by $762 billion," Mthathi said.

"Corporations have to pay tax and avoid illicit financial outflows. Governments have to close tax loopholes which rob the poor of the money required for healthcare, education and development," she said, noting that Africa loses over $10 billion per year in illicit financial outflows.

The Oxfam report said the $762 billion increase in the rich's wealth last year is enough to remove extreme poverty seven times.

It said between 2006 and 2015, ordinary workers' income rose by an average of 2 percent a year while the billionaires' wealth increased by 13 percent, which is almost six times faster.

Mthathi said women produce $10 trillion in unpaid care annually to support global economy and the world has to change the rules where women's input are not remunerated.