Microsoft chairman Bill Gates is asking the Group of 20 nations to step up development efforts to ease poverty, saying this is an important investment despite economic woes in wealthy countries.
“Development isn’t just good for people in poor countries; it’s good for all of us,” Gates wrote in a Washington Post essay Wednesday.
“If countries that are currently poor can feed, educate and employ their people, then over time they will contribute to the world economy.
“On the supply side, they’ll increase the production of key commodities such as food, keeping prices lower. On the demand side, as their citizens are more productive, they’ll become important markets for trade.”
In contrast, if people lack access to basic necessities, “continued suffering will lead to economic stagnation and instability,” he said.
“It is, for example, not only unconscionable but also a strategic mistake to allow famine to devastate the livelihoods of millions of people in the Horn of Africa.”
Gates, whose Bill and Melinda Gates Foundation has spent billions on aid efforts around the globe, said he is submitting a report to the G20 governments ahead of their summit opening Thursday in France, suggesting “creative ways for the world to continue investing in development despite fiscal constraints.”
He said the G20 should seek to encourage more private sector funding for needy nations as well.
“The private sector hasn’t always invested as much in development as it should because the market incentives haven’t always been clear, but there are ways to encourage involvement,” he wrote.
“In my report to the G20, I’ll make half a dozen recommendations for mobilizing tens of billions of dollars annually from private sources. The African diaspora is sitting on $50 billion in savings that could fund development in their home countries if it were captured through diaspora bonds.”
Gates added that if transaction costs on remittances worldwide were cut from an average of 10 percent to five percent, “it would unlock $15 billion a year in poor countries.”
He also suggested that sovereign wealth funds, sitting on trillions of dollars, could set aside a portion “for key infrastructure projects in poor countries.”
Gates said aid over the years has lifted many people out of poverty in a number of countries: “Imagine the world economy without Brazil, China, India, Indonesia, South Korea, Mexico or Turkey,” he said.
“Sometimes Americans get the impression that we’re shouldering the whole burden of development and that, ultimately, our aid doesn’t make a big difference.
I see it very differently,” Gates said. “We’re providing strategic investments that link up with many other investments to systematically make a better, more prosperous and safer world.”