Ahead of the G20 summit: Economists sound the alarm about a global "inequality emergency".

Pretoria. A group of six renowned economists is denouncing a global “inequality emergency.” The richest one percent of people captured approximately 41 percent of global wealth creation between 2000 and 2024, according to a report led by Nobel laureate Joseph E. Stiglitz, published ahead of the G20 summit of major industrialized and emerging economies, which will take place on November 22 and 23 in Johannesburg, South Africa.

Only one percent of the wealth generated during that period benefits the poorest 50 percent of the world's population, the report states. This means that the average wealth of one percent of the world's population increased by $1.3 million (€1.1 million) per person in about five years, while the average wealth of the poorest 50 percent grew by only $585 (€507) per person. According to the analysis, a minority is expected to inherit $70 trillion (€60.7 billion) over the next ten years.

Income disparities between the Global North and South remained particularly pronounced. According to the World Bank, income levels differ significantly in approximately 90 percent of the world's population, or 83 percent of all countries. The report states that high wealth disparity undermines democracy, social cohesion, and the economy. Countries with high disparity are seven times more likely to experience a deterioration of their democratic environment than countries with greater equality.

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Since 2020, events such as the Corona pandemic, the war in Ukraine, the new tariffs imposed by the USA and the resulting trade disputes have created a "perfect storm" that is further exacerbating poverty and inequality.

The report recommends the creation of an “International Panel on Inequality,” similar to the Intergovernmental Panel on Climate Change (IPCC), to advise policymakers and the international community. “The world has recognized that we are in a climate crisis. It is time we also recognized that we are in an inequality crisis,” said Stiglitz. Globally, one in four people now regularly goes without meals, while the wealth of billionaires has reached its highest level in history.

To reduce disparity, the authors recommend reforming international economic rules, such as fairer taxation of multinational corporations and the very wealthy. At the national level, they suggest implementing more employee-friendly regulations, reducing corporate concentration, taxing large capital gains, investing in public services, and implementing more progressive tax and spending policies.

This year's G20 summit is being held under the motto "Solidarity, Equality and Sustainability." The G20 comprises 19 countries, the European Union, and the African Union. The group represents approximately 80 percent of the world's population and more than 85 percent of global economic output. South Africa intends to use its presidency this year to address the debt burden of developing countries and to promote a just energy transition.

RND/dpa