Context & Significance
This is the first-ever G20 report dedicated entirely to global inequality.
It calls inequality not just an economic issue but a “global emergency”—comparable in scale and urgency to the climate crisis.
The report urges the establishment of a new “International Panel on Inequality (IPI)”, modeled on the Intergovernmental Panel on Climate Change (IPCC), to systematically track, analyze, and guide policies against inequality.
🌍 Key Findings
1. Extreme Wealth Concentration
From 2000–2024, the top 1% captured 41% of all new wealth, while the bottom 50% received only 1%.
The average wealth increase:
Top 1%: +US$1.3 million
Bottom 50%: +US$585 (constant 2024 dollars)
2. Global Inequality Levels
83% of all countries, covering 90% of the world’s population, meet the World Bank’s definition of high inequality.
Such countries are 7 times more likely to face democratic decline.
3. Inherited Wealth Boom
Around $70 trillion in wealth will be transferred to heirs over the next decade, posing a major threat to social mobility and equality of opportunity.
4. Global Trends
Inequality between individuals globally has narrowed (mainly due to China’s growth), but:
Gap between the Global North and South remains very wide.
Future prospects for reduction are uncertain.
5. New ‘Perfect Storm’ of Inequality
Recent shocks—COVID-19, the Ukraine war, new trade barriers (2025)—have intensified inequality:
1 in 4 people worldwide regularly skip meals.
Billionaire wealth has reached its highest-ever level.
⚠️ Implications of Inequality
Economic: Concentrated wealth hampers productivity and innovation.
Political: Fuels democratic erosion and elite capture of policy.
Social: Weakens cohesion, increases social unrest, and worsens poverty.
Environmental: Inequality undermines sustainability transitions.
🧩 Major Recommendations
1. Creation of an International Panel on Inequality (IPI)
A global, independent scientific panel (similar to IPCC).
Mandate: collect data, monitor trends, analyze drivers, and evaluate policy options.
Backed by champion countries and multilateral agencies.
Proposed as a “permanent legacy” of South Africa’s G20 Presidency.
2. Reform International Economic Rules
Redesign intellectual property rules, especially for pandemics and climate change technologies.
Reform global tax architecture:
Fair taxation for multinationals and ultra-wealthy.
Support for the UN Tax Convention for global cooperation.
3. National-Level Policy Actions
Pro-worker policies and stronger labor protections.
Curb corporate concentration and monopolistic practices.
Progressive taxation on capital gains and wealth.
Invest in public goods – education, health, and social protection.
4. Global Cooperation Models
Foster North–South cooperation on tax, trade, and green transition.
Explore new multilateral frameworks to address inequality across borders.
🧠 Expert Committee Members
| Expert | Country | Role/Institution |
|---|---|---|
| Prof. Joseph E. Stiglitz | USA | Nobel Laureate, Columbia University, Roosevelt Institute |
| Dr Adriana E. Abdenur | Brazil | Co-President, Global Fund for a New Economy |
| Ms Winnie Byanyima | Uganda | Executive Director, UNAIDS; Co-chair, People’s Medicines Alliance |
| Prof. Jayati Ghosh | India | University of Massachusetts Amherst; Co-Chair, ICRICT |
| Prof. Imraan Valodia | South Africa | Director, Southern Centre for Inequality Studies, WITS |
| Dr Wanga Zembe-Mkabile | South Africa | Public Health Expert, SAMRC and UWC |
🗣️ Key Quotes
President Cyril Ramaphosa:
“Inequality is a betrayal of dignity, an impediment to inclusive growth, and a threat to democracy. Addressing it is our generational challenge.”
Prof. Joseph Stiglitz:
“The world recognizes a climate emergency—it’s time we recognize an inequality emergency too. It undermines both our economies and democracies.”
📘 UPSC Mains Relevance
📍 GS Paper 2 – Governance / International Relations
Global governance reform through multilateral cooperation.
Role of G20 in shaping equitable international order.
📍 GS Paper 3 – Economy
Inclusive growth, wealth concentration, global inequality trends.
Relevance of international taxation and redistribution mechanisms.
📍 GS Paper 4 – Ethics
Equity, justice, and social responsibility in global policymaking.
🧩 Possible UPSC Mains Questions
“The G20’s call for an International Panel on Inequality signals a paradigm shift in global economic governance.” Discuss.
“Global inequality today poses as grave a challenge to humanity as climate change.” Critically examine.
“Extreme wealth concentration undermines democracy and economic growth alike.” Explain in light of the 2025 G20 Inequality Report.
Evaluate the significance of South Africa’s leadership in putting inequality at the centre of the G20 agenda.
