Making globalization humaneThe tenth anniversary of a new tax is not often a cause for celebration. Jubilation is normally reserved for occasions when a tax is abolished. But, in this case, we’re not talking about any old tax.
In 2006, French President Jacques Chirac pushed through a new solidarity levy on airline tickets. The tax was designed to provide an additional revenue stream for official development assistance, making efforts to control AIDS, TB and malaria more effective and, in doing so, helping to speed up progress toward the health-related Millennium Development Goals.
The tax is an innovative funding instrument intended to tackle the social inequalities that have deepened as the world’s economic and financial systems become ever more globalized. It redistributes part of the wealth generated by global trade by targeting the growth in air traffic — an otherwise low-tax industry. The funds are then used to support health programs for the poorest populations affected by AIDS, TB and malaria.
Conceived as a citizen tax, and with no direct impact on air transport (a sector that closely tracks global middle-class population trends), the levy has so far raised around 1.7 billion euros ($1.83 billion) in France since 2006. The levy is simple in principle and in practice.
Every passenger departing from a French airport — irrespective of nationality or airline — pays a small levy of a few euros on the price of the ticket. So it works in exactly the same way as an airport tax. Revenue collected from the tax in France is assigned to the Development Solidarity Fund which, in turn, contributes to UNITAID and the Global Fund to Fight AIDS, Tuberculosis and Malaria.
Never before have such innovative funding mechanisms, introduced in many countries, including South Korea, been more crucial. Yet more imaginative and sustained funding solutions will be needed if we are to achieve the Sustainable Development Goals adopted by the international community in 2015, and in particular if we want to end the AIDS, TB and malaria epidemics by 2030.
In the last 15 years, collective global efforts to reduce poverty have radically transformed the situation in developing countries. But while statistics show that the poverty gap between countries is narrowing, the opposite is true when it comes to income, health access and rights between individuals or population groups, where the divide continues to grow.
Some developing countries have capitalized on the economic growth dividend to bolster their national budgets and in many cases, although progress is not yet secured, have scaled up investment in domestic health services and infrastructure.
Yet the world’s poorest countries still rely on international aid because they do not have sufficient domestic resources to provide decent health care for their people. The same applies to those countries already on the road to financial independence, which need external support to safeguard the health and rights of the most vulnerable and marginalized people in society — the very people who are last in line to feel the impact of poverty reduction, health and education improvements.
As official development budgets become increasingly squeezed, innovative funding mechanisms are vital to ensuring that the development progress made in recent years is not lost, and to maintaining our pledge to support the poorest countries and populations. France has consistently been the second-largest donor to the Global Fund, contributing a total of US$ 4.4 billion (ODA and innovative funding combined) between 2002 and end-2015.
There is a pressing need to explore innovative new funding mechanisms — both unilaterally and multilaterally. The money collected through the airline ticket levy and invested in UNITAID, the Global Fund and other solidarity and development initiatives continues to produce returns of inestimable value. The Global Fund and its partners, such as UNITAID, have saved more than 20 million lives — equivalent to the population of Cameroon — since 2002.
By imposing a solidarity levy on airline tickets and channeling these funds to UNITAID and the Global Fund, we are making globalization work for humanity.
*The author is president of Friends of the Global Fund Europe, a nonprofit organization that engages with public and private sector stakeholders in Europe on the task of combating AIDS, tuberculosis and malaria.