Inequality is a problem all countries of the world, including Nigeria, have been unable to address. A new report paints a horrible picture of its impact on the poor, writes FRANK IKPEFAN
The recent COVID-19 pandemic came with a stark paradox – driving up the wealth of the three richest Nigerians while impoverishing millions of other citizens.
When the pandemic broke out in early 2020, it threw the entire world into turmoil. World leaders were in a race to find solutions to a virus that had affected every aspect of life – businesses, economy and others.
But it didn’t stop billionaires from profiting; from making profit. The pandemic presented an irony; a case of the rich getting richer and the poor man getting poorer.
According to the report “Inequality Kills” released by Oxfam in Nigeria – an international non-governmental organisation, billionaires made more money in the first two years of the virus than they had done in 14 years.
The super-rich and the pandemic
Globally, the report said 10 richest men more than doubled their fortunes from $700 billion to $1.5 trillion —at a rate of $15,000 per second or $1.3 billion a day— during the first two years of a pandemic that has seen the incomes of 99 percent of humanity fall and over 160 million more people forced into poverty.
It noted that billionaires’ wealth has risen since COVID-19 began than it has in the last 14 years with a new billionaire minted every 26 hours, as inequality contributed to the death of one person every four seconds.
According to Forbes, the 10 richest people, as of 30 November 2021, have seen their fortunes grow by $821 billion dollars since March 2020.
The 10 richest men were listed as: Elon Musk, Jeff Bezos, Bernard Arnault & family, Bill Gates, Larry Ellison, Larry Page, Sergey Brin, Mark Zuckerberg, Steve Ballmer and Warren Buffet.
Nigerian billionaires were not left out of the profit. In Nigeria, three billionaires – Aliko Dangote, ($13.5billion), Mike Adenuga ($6.5billion) and Abdulsamad Rabiu ($4.9billion) saw their wealth increased to $6.9billion during the outbreak of the COVID -19 pandemic which begun in March 2020, the report by Oxfam in Nigeria said.
Collectively, the total wealth of the three billionaires in Nigeria equal $24.9billion, the report stated.
The report said the billionaires saw their wealth increase by 38.3 per cent during the pandemic while 7.4million people are estimated to have fallen into extreme poverty in 2020.
It noted that two out of the three richest billionaires have more wealth than the bottom 63million of Nigerian society.
The report said there are 4,690 individuals with a net worth of $5 million or more, with wealth totalling $107.2 billion in the country.
It added that there are 245 individuals with $50 million or more with a combined wealth of $56.5 billion.
What the billions can do
According to the report, at $5 trillion dollars, this is the biggest surge in billionaire wealth since records began.
It said a one-off 99 per cent tax on the ten richest men’s pandemic windfalls, for example, could pay:
- to make enough vaccines for the world;
- to provide universal healthcare and social protection, fund climate adaptation and reduce gender-based violence in over 80 countries; while still leaving these men $8 billion better off than they were before the pandemic.
“If these ten men were to lose 99.999 per cent of their wealth tomorrow, they would still be richer than 99 percent of all the people on this planet,” said Oxfam International’s Executive Director Gabriela Bucher.
“They now have six times more wealth than the poorest 3.1 billion people,” Bucher added.
Time to correct extreme inequality – Oxfam Director
Extreme inequality is a form of economic violence, where policies and political decisions that perpetuate the wealth and power of a privileged few result in direct harm to the vast majority of ordinary people across the world and the planet itself.
According to Oxfam in Nigeria, globally, inequality is contributing to the death of at least 21,000 people each day, or one person every four seconds as a result of lack of access to healthcare, gender-based violence, hunger and climate breakdown.
“This is a conservative finding based on deaths globally from lack of access to healthcare, gender-based violence, hunger, and climate breakdown,” Oxfam in Nigeria said in the report.
It warned that inequality between countries is expected to rise for the first time in a generation, adding that developing countries denied access to sufficient vaccines because of rich governments’ protection of pharmaceutical corporations’ monopolies, have been forced to slash social spending as their debt levels spiral and now face the prospect of austerity measures.
“The proportion of people with COVID-19 who died from the virus in developing countries is roughly double that in rich countries,” Oxfam said.
The Country Director of Oxfam in Nigeria, Dr. Vincent Ahonsi, speaking virtually during the presentation of the report in Abuja said: “It is disappointing that the two richest billionaires in Nigeria have more wealth than the bottom 63 million Nigerians. It is about time we begin to correct these extreme inequalities.
“Collectively, the total wealth of the three billionaires in Nigeria equals $24.9 billion and throughout the pandemic (beginning in mid-March 2020), their wealth increased $6.9 billion while the majority of Nigerians are poorer. It is a remarkable surge in wealth at the very top of the society, which has not impacted positively on the majority.”
He added: “As the COVID-19 pandemic and the associated social-economic distress impact more on the families, women and girl now face unprecedented risk of physical, sexual and psychological abuse and violence.
“It is now a moral burden on billionaires to invest more on social goods including water and sanitation, education, food security, health and social infrastructure as part of their corporate social responsibilities for a just post-pandemic recovery.
“We can end inequality and it is a moral duty for the billionaires and corporations to play their part to end hunger, disease and poverty.”
Also, Executive Director, Civil Society Legislative Advocacy Centre (CISLAC), Auwal Rafsanjani, noted that there is an urgent need for government and policy makers to respond to the issues of inequality which has been escalated by the COVID-19 pandemic.
He said the COVID-19 pandemic has further compelled the poor Nigerians to a deteriorating standard of living, thereby broadening the inequality between the rich and the poor.
“It is high time the government came up with policies and placed taxes on the wealth of the few rich ones, instead of the newly introduced tax on soft drink and digital service which will affect the poor,” he said.
He further explained that inequality poses a great threat to the overall national development.
Rafsanjani pointed out that the Covid-19 pandemic has further widened the inequality gap between the rich and the poor.
He said the funds made available during the period gave looters the opportunity to misappropriate and loot funds.
According to him, during the period Nigeria got a lot both in kind and cash, adding that the $13 billion loan collected from the International Monetary Fund to ameliorate the sufferings of Nigerians during the pandemic is yet to be accounted for.
He warned that subsidy removal on petrol and electricity would further make life difficult for the masses, saying the government needs to start taxing the rich to improve the living conditions of many Nigerians.
The CISLAC boss also warned that the introduction of new taxes on sugar and soft drinks would further create inequality that would continue to deepen the country’s poverty level as the inequality gap is winding up.
What the government should do
Oxfam in Nigeria, in its factsheet, said an annual wealth tax in Nigeria would raise $4.1 billion a year (with rates at 2% on wealth over $5 million, 3% on wealth over $50 million and 5% on wealth over $1 billion).
A progressive wealth tax on the rich in the country would raise $6.1 billion (with rates at 2 per cent on wealth over $5 million, 5 per cent on wealth over $50 million and 10 per cent on wealth over $1 billion), it added.
“An annual wealth tax applied to the wealth of multi-millionaires and billionaires would raise $4.1 billion a year, enough to more than double the government’s health budget or reduce households’ out of pocket health expenditure by 40 per cent,” the organisation said.
While maintaining that Oxfam is not against rich people, the Oxfam country director said the federal government can claw back the gains by billionaires by taxing their huge new wealth made since the start of the pandemic through permanent wealth and capital taxes.
According to the country director of Oxfam in Nigeria, the rich should pay more tax. He noted that one per cent of their wealth will help the federal government to solve some of the social problems in the country.
He urged the government to invest the trillions that could be raised by these taxes toward progressive spending on universal healthcare and social protection, climate change adaptation, and gender-based violence prevention and programming.
“Tax the rich more. One per cent of their wealth will help the government to solve the social problems in the country. Oxfam is not against the rich or billionaires. What we are saying is let us tax them a bit through progressive tax system,” Ahonsi added.
In its recommendations, the organisation urged the government to tackle sexist and racist laws that discriminate against women and racialised people and create new gender-equal laws to uproot violence and discrimination.
It said all sectors of society must urgently define policies that will ensure women, racialised and other oppressed groups are represented in all decision-making spaces.
Oxfam in Nigeria urged the government to end laws that undermine the rights of workers to unionise and strike, and set up stronger legal standards to protect them.
It urged rich governments to immediately waive intellectual property rules over COVID-19 vaccine technologies to allow more countries to produce safe and effective vaccines to usher in the end of the pandemic.
