Pandemic inequalities could fuel global unrest, IMF warns

Pandemic inequalities could fuel global unrest, IMF warns

Sourced from the net by Tracy Cabrera

GENEVA, SWITZERLAND — Noting how the poor and marginalized have been severely affected by the impact on economy and livelihood by the coronavirus pandemic, the International Monetary Fund (IMF) has warned about the worsening and long-standing inequalities around the world that could undermine global economic stability.

In a recent statement, the IMF noted how poorest families have been hit particularly hard as well as the damage to education could last for years if left unattended and without initiatives for resolution from the world’s foremost leaders, among them the presidents of the United States, People’s Republic of China and others from Europe, Canada, Australia and even Africa and the Indian sub-continent.

Findings from an IMF report has shown that the warnings coming from fund economists last year have materialized and this has alarmed most human rights groups as the disparity between the rich and the poor has widened over the months, especially now that up to 90 percent of vaccine supplies for Covid-19 has been cornered by wealthy countries like the US and the United Kingdom.

“Covid-19 has exposed and exacerbated preexisting inequalities in incomes and access to basic public services, such as health care and vaccination, both within and across countries,” the report said.

“Disruptions to education threaten social mobility by leaving long-lasting effects on children and youth, especially those from poorer households,” it added.

And the IMF likewise brought to the fore the increasing reliance on digital work and schooling which has worsened the impact of the health crisis and the economic downturn the pandemic has triggered, thus making it harder for low-skilled workers to find much-needed employment.

“Against this backdrop, societies may experience rising polarization, erosion of trust in government, or social unrest,” the IMF warned.

In a advisory note, the global financial funding institution dared to make an appeal to a number of countries for the raising of some taxes and improving tax collection to provide revenue for an improved social safety net.

In a blog post, IMF’s David Amaglobeli, Vitor Gaspar, and Paolo Mauro, authors of the report, called for governments to “give everyone a fair shot at prosperity,” by improving access to health care, vaccinations, education and good jobs.

They suggested countries could rely more on property and inheritance taxes, increase the tax rate for the wealthiest earners, and eliminate loopholes as well as “modernizing corporate income taxation.”

“Governments can also consider temporary Covid-19 recovery contributions for high-income households,” they added.

Amaglobeli explained that using funds for key social programs can have “a powerful effect” at a time when “up to six million children in emerging market and developing economies could drop out of school 2021—with lifelong adverse consequences.”

“If governments increased spending on education by one percent of GDP, for example, they could reduce the gap in enrollment rates between the richest and the poorest families by almost one-third,” the authors concluded. (AI/MTVN)

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