New HDR Urges Financial Transactions Tax to Fund Poverty Fight

The latest Human Development Report is supporting the call for the introduction of an international currency trading tax or broader financial transaction levies to finance the global climate change and poverty fight.

According to the 2011 HDR, a 0.005 percent tax on foreign exchange trading would generate $40 billion per year or more for aid efforts, which face funding cuts due to the global financial crisis.

“The tax would allow those who benefit most from globalization to help those who benefit least,” the report says.

It estimates that climate change adaptation initiatives would require about $105 billion. Slowing climate change and preventing further environmental degradation, the report argues, are necessary to continue the development progress in the world’s poorest countries.

“The report’s central message is that equity and sustainability are inextricably linked — that one will not be achieved without the other,” U.N. Development Program Administrator Helen Clark said Nov. 2 at the launching of the 2011 HDR in Copenhagen, Denmark. “It raises a number of issues which are important for our understanding of this relationship and offers guidance for moving forward on both dimensions.”

HDR is UNDP’s flagship annual publication, the first of which was issued in 1990. This year’s report, titled “Sustainability and Equity: A Better Future for All,” shows Norway, Australia and the Netherlands atop the Human Development Index, while the Democratic Republic of Congo, Niger and Burundi are at the bottom. 

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About the author

  • Eliza Villarino

    Eliza Villarino currently manages one of today’s leading publications on humanitarian aid, global health and international development, the weekly GDB. At Devex, she has helped grow a global newsroom, with talented journalists from major development hubs such as Washington, D.C, London and Brussels. She regularly writes about innovations in global development.