Euro zone break-up 'would hit aid'

 

The break-up of the euro zone could cost the world’s poorest countries nearly €25 billion a year in lost trade and investment - the equivalent of almost a quarter of global aid - Oxfam warned today.

As leaders of the world’s biggest economies prepare to meet at the G20 summit in Mexico, the aid charity warned that the woes of the single currency threaten the living standards of people well beyond the shores of Europe.

The euro zone crisis is set to dominate next week’s G20 gathering, but Oxfam chief executive Barbara Stocking urged the leaders  not to forget the needs of the world’s poorest countries.

A United Nations appeal to help 18 million people threatened by food shortages in west Africa is still €490 million underfunded.

Ms Stocking called on the G20 countries to pay their “fair share” towards tackling the crisis.

Oxfam has calculated that the collapse of the euro and the resulting decline in EU nations’ income would cost the world’s poorest countries up to €15 billion over the next year in revenue from exports to Europe and a further €7.9 billion in reduced investment from the continent.

Without additional help, this could lock many countries into a “vicious spiral” of falling export earnings forcing cuts in spending on essential services like health and education, said the charity.

Ms Stocking, who will attend the G20 as a member of a food taskforce, said: “The euro crisis doesn’t just threaten livelihoods from Athens to Madrid.

“It is a clear and present danger to people in low-income countries who are struggling with grinding poverty and already feeling the effects of significant cuts in aid.

“G20 leaders have an obligation to find a solution to this crisis, not just on behalf of their own citizens but to protect all those that have exhausted their means to protect themselves.”

Oxfam is calling on the G20 to implement a five-point plan to reform the food system; clamp down on tax dodging; raise cash for the poor with a “Robin Hood tax” on financial transactions; reduce inequality, and support investment in public health and education.

Ms Stocking said: “Our leaders must take much bolder steps towards delivering a fairer, safer and more prosperous world for all and addressing the issues that mean one in seven of the world’s population don’t have enough to eat.

“The big question is whether the G20 has the political will to step up and deliver.”

PA