Gates is set to release a report to the G20 nations that spells out creative ways in which Western nations can do more to fight poverty. The report also stresses the economic imperatives of fighting poverty as a means of keeping the global economy stable.
"The world will not balance its books by cutting back on aid," Gates claims to the American Foreign Press
, "but it will do irreparable damage to global stability, to the growth potential of the global economy and to the livelihoods of millions of the poorest people."
"The private sector hasn't always invested as much in development as it should because the market incentives haven't always been clear, but there are ways to encourage involvement."
Canadian Prime Minister Stephen Harper will be on hand at the summit. Harper's actions are exactly those being targeted by Gates' comments, as Ottawa has frozen all foreign aid as a temporary means of reducing the deficit.
This, Gates believes, is counter productive.
In some cases foreign aid needs to continue simply because people's lives have come to depend upon it. But often development money has far greater implications for local economies in the developing world, which in turn help provide new opportunities for innovation and research, let alone global economic stability.
“Aid is a small investment that generates a huge return," Gates reports in the Toronto Star
. "Those are precisely the investments we should spare when it’s time to make cuts."
Gates is in a position to be listened to on the matter, as the billionaire has long been using portions of his vast fortune to fund charitable work throughout the world. It is estimated that The Gates Foundation
has donated over $6B to various causes in the developing world in the past five years alone. When someone with Mr. Gates stature and clout speaks to world leaders, they tend to listen.
But Mr. Gates is sensitive to the fact that since the 2008 economic downturn, many Western nations have been hard pressed to come up with funds for domestic expenses, let alone finding money for foreign assistance.
"It's very tough now," Gates told the Guardian
. "Government budgets are being looked at very hard."
Yet the Gates report argues that if traditional donors stick with the donation amounts they have previously set, upwards of $80B annually can be raised for development aid, starting in 2015. He also spoke in favour of what the Guardian
has referred to as the 'Robin Hood Tax,' or financial transaction tax as it is more commonly known.
Under such a system, a tax would be placed on taxable financial transactions between financial institutions, but not on the financial institutions themselves. The sole purpose of the FTT from the beginning has been to raise hard-to-find funds for international development.
Gates is arguing that if Europe alone moves forward with the FTT, as France and Germany are claiming they will, it has the potential to raise an additional $9B annually, according to AFP
. But this amount could be the tip of the iceberg if North American and other wealthy nations come on board with the FTT plan.
"With its diverse and dynamic membership, the G20 is in a phenomenal position to help us all think about development in new ways," Gates wrote.
The two-day G20 summit is set to open in Cannes Thursday morning.