PHM-Exch> PHM UK requests advice from PHM friends in the South...

[Claudio Schuftan]

From: margaret reeves margreeves at yahoo.co.uk

Dear PHM friends

PHM in the UK has been asked to co-host a day and a half programme called
'More Aid for Development', in conjunction with the National Aids Consortium
and the Stamp Out Poverty campaign. The programme will focus on the concept
and application of a currency transaction levy (CTL) as a way of funding
development for health. There will be a session, too, on reform of global
financial institutions, and the role of the World Bank in health.

We felt it would be really important to have voices, particularly from the
south, to engage in the debate about the pros and cons of CTLs. I have
written a short summary of the concept of CTLs, and added a couple of
questions at the end. It would be wonderful to have feedback to these
questions that I could bring to the meeting on 12th October. I wondered if
you could cascade it to country or interest circles for their comments?

Please reply to me; phmukcoordinator at yahoo.co.uk
thank you so much
In solidarity
Margaret (PHM UK coordinator)

*PHM UK is seeking your guidance and comments…..*

* *

PHM UK has  been asked to take part in a workshop day exploring the idea of
Currency Transaction Levies (CTLs) as a means of financing development in
global health. As a UK Circle, we would welcome the input of PHM members and
circles in other countries, particularly in the South about whether the idea
of CTLs is one that would be generally supported, and a response to some of
the more difficult issues the proposal raises. *We would like to take  your
comments and suggestions to the forthcoming workshop.*



The proposal is for a levy based on transactions of the world's major
currencies. The currency transaction market has been chosen because it is so
huge, worth more than $4 trillion a day. It is also a market that is still
growing even in times of economic crisis. Raising a levy on it would
potentially provide a stable income stream for health development. A levy of
0.005% raised on the transactions of the world's most traded currencies has
been proposed. This level was suggested in a model put forward by the
North-South Institute in a report for the UN on this subject. The model
indicates that a levy this low would not significantly impact the volume of
the currency market, but would generate $33 billion every year. The proposal
of such a levy was considered in the UN financing for development conference
in 2008.



The idea of extracting a levy on financial transactions is not new; there is
already a 0.5% duty on share transactions in the UK as one such example. Two
European countries, France and Belgium, already have legislation in place to
support a currency transaction levy. International currency transactions
take place electronically, so the mechanism of imposing a levy on the
transactions would be technically feasible.



It is important to note that the proposed CTL would be on the wholesale
market and not the retail market. This means it won't affect people sending
money to their family abroad (migrant remittances) or people exchanging
money when travelling abroad.



*Some of the issues that would need to be considered are…*



1. Should we be working towards, promoting or campaigning for a currency
transaction levy, when it does nothing to change the underlying structures
of the financial institutions?



2. How would the money raised through a currency transaction levy be spent
on health - how should it be channelled? would it go to single or vertical
programmes, or health system strengthening or strengthening global
institutions for health? Who should decide?



*Please send your comments to *

* *

*phmkcoordinator at yahoo.co.uk, by 9th October so they can be presented on
12th October.  *
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