Progress in reducing inequality within and among countries has been mixed.
- The voices of developing countries still need to be strengthened in decisio n-making forums of international economic and financial institutions. Moreover, while remittances can be a lifeline for families and communities of international migrant workers in their countries of origin, the high cost of transferring money continues to reduce such benefits.
- From 2008 to 2013, the per capita income or consumption of the poorest 40 per cent of the population improved more rapidly than the national average in 49 of 83 countries (accounting for three quarters of the world’s population) with data.
- The International Monetary Fund, through its recent quota reform, has increased the share of developing countries’ vote (defined as countries in developing regions, according to the M49 classification) to 37 per cent in 2016, up from 33 per cent in 2010. That increase is still short of the 74 per cent they represent in the membership. While the World Bank reforms of 2010 are still being implemented, that effort has not changed the 38 per cent share of voting rights at the International Bank for Reconstruction and Development that developing countries have held since 2000.
- Duty-free treatment and favourable access conditions for exports from least developed and developing countries have expanded. From 2005 to 2015, the proportion of tariff lines globally with duty-free treatment for products that originate in developing countries increased from 41 per cent to 50 per cent; for products that originate in the least developed countries, the proportion rose from 49 per cent to 65 per cent.
- The least developed countries and small island developing States continue to require additional assistance to ensure that they share in the benefits of sustainable development. In 2015, total resource flows to the least developed countries and small island developing States amounted to $48 billion and $6 billion, respectively. Eight donor countries met the target of 0.15 per cent of gross national income (GNI) for ODA to the least developed countries.
- The benefits of remittance from international migrant workers are reduced somewhat by the generally high cost of transfer. On average, post offices and money transfer operators charge over 6 per cent of the amount remitted; commercial banks charge 11 per cent. Both are significantly above the 3 per cent target. New and improved technologies, such as prepaid cards and mobile operators, result in lower fees for sending money home (between 2 per cent and 4 per cent), but are not yet widely available or used for many remittance corridors.
Source: Report of the Secretary-General, "Progress towards the Sustainable Development Goals", E/2017/66
Efforts have been made in some countries to reduce income inequality, increase zero-tariff access for exports from LDCs and developing countries, and provide additional assistance to LDCs and small island developing States (SIDS). However, progress will need to accelerate to reduce growing disparities within and among countries.
- Between 2010 and 2016, in 60 out of 94 countries with data, the incomes of the poorest 40 per cent of the population grew faster than those of the entire population.
- In 2016, over 64.4 per cent of products exported by LDCs to world markets and 64.1 per cent of those from SIDS faced zero tariffs, an increase of 20 per cent since 2010. Developing countries overall had duty-free market access for about 50 per cent of all products exported in 2016.
- In 2016, receipts by developing countries from member countries of the Development Assistance Committee of the OECD, multilateral agencies and other key providers totalled $315 billion; of this amount, $158 billion was ODA. In 2016, total ODA to LDCs and SIDS from all donors totalled $43.1 billion and $6.2 billion, respectively.
- Based on provisional data, among the $613 billion in total remittances recorded in 2017, $466 billion went to low- and middle-income countries. While the global average cost of sending money has gradually declined in recent years, it was estimated at 7.2 per cent in 2017, more than double the target transaction cost of 3 per cent.
Source: Report of the Secretary-General, The Sustainable Development Goals Report 2018
- Goal 10 calls for reducing inequalities in income as well as those based on age, sex, disability, race, ethnicity, origin, religion or economic or other status within a country. The Goal also addresses inequalities among countries, including those related to representation, migration and development assistance.
- Target 10.1 seeks to ensure that income growth among the poorest 40 per cent of the population in every country is more rapid than its national average. This was true in 56 of 94 countries with data available from 2007 to 2012. However, this does not necessarily imply greater prosperity, since nine of those countries experienced negative growth rates over that period.
- The labour share of GDP, which represents the proportion of wages and social protection transfers in an economy, provides an aggregate measure of primary income inequality. A shift of income away from labour towards capital has contributed to rising inequality. Globally, the labour share of GDP decreased from 57 per cent in 2000 to 55 per cent in 2015, mainly owing to stagnating wages and a decline in employers’ social contributions in developed regions, while the trend was stable or slightly upward in developing regions.
- Preferential treatment for developing countries and the least developed countries in trade can help reduce inequalities by creating more export opportunities. Major developed country markets already offer duty-free market access to the least developed countries on most of their tariff lines. But even when they do not, as in the case of some agricultural products, the average applied tariff rate is often close to zero per cent. The share of exports from the least developed countries and developing regions that benefitted from duty-free treatment increased from 2000 to 2014, reaching 79 per cent for developing countries and 84 per cent for the least developed countries. The comparative advantage of the least developed countries in duty-free access varies depending on the product groups analysed. Almost all agricultural products from the least developed countries (98 per cent) were exempt from duties by developed countries, versus 74 per cent of products from developing countries. Shares of exports exempt from duties diverged even more for textiles and clothing: the rate for both product groups for the least developed countries was around 70 per cent, while for developing countries it was 41 per cent for textiles and 34 per cent for clothing.
- Official development assistance and financial flows contribute to reducing inequalities within and among countries. In 2014, total resource flows for development to the least developed countries totalled $55.2 billion, and eight donor countries met the target of 0.15 per cent of gross national income (GNI) for ODA to the least developed countries. Preliminary ODA figures for 2015 show that bilateral net ODA to the least developed countries increased by 4 per cent in real terms, compared to 2014.
- People migrate for many reasons, including better employment opportunities and higher wages. When successful, many migrants send money back to their country of origin to care of family members. Remittances to developing countries have increased slightly, rising to $431.6 billion in 2015, up 0.4 per cent from 2014. In contrast, global remittances (including those to developed countries) were estimated at $582 billion in 2015, a decline of 1.7 per cent from 2014. Even with the global contraction in remittance flows in 2015, the longer term trend is upward. However, the cost of sending money across national borders is significant, averaging 7.5 per cent of the amount remitted in 2015, down from 10 per cent in 2008 but still above the 3 per cent called for in target 10.c.