Extreme inequality is a threat to democracy, warns Oxfam International's Executive Director Winnie Byanyima, at today's closing session of the IMF - Mozambique government's Africa Rising conference.
Addressing global decision makers, Ms. Byanyima said that "when wealth shapes policy-making, the rules bend to favor the rich, democratic governance suffers and corruption proliferates."
Africa has six of the top 10 fastest growing economies in the world - yet despite strong economic growth, Sub-Saharan Africa is home to six out of the 10 most unequal countries in the world.
The resource curse
Much of the continent's growth over the last decade has been driven by new discoveries of oil, natural gas and mineral reserves. However, it is estimated that Africa loses $63 billion a year to illicit flows and tax dodging. The resource drain from Africa over the last 30 years is almost equivalent to its current GDP.
"If Ethiopia could capture just ten per cent of the money it loses each year through tax exemptions it could enroll 1.4 million more children in school," added Ms. Byanyima. "Tax advantages do not bring more resources to a country; they deprive them of needed resources."
Tax reform and investment
Oxfam is calling on delegates to take action against rising and damaging economic inequality by implementing more progressive tax policies, investing in public services and jobs and committing to ending extreme poverty.