Why that Paris trip will cost a little more

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Why that Paris trip will cost a little more


Special to Globe and Mail Update

As of July 1, all passengers taking off from French territory (except those in transit) will pay an air-ticket levy that will be used for the purchase of pharmaceuticals against the most serious pandemics (such as HIV/AIDS, tuberculosis and malaria) in the developing world.

According to a law passed by the French parliament, passengers on international flights such as Paris-New York, Paris-Shanghai or Paris-Toronto will pay a maximum €4 ($5.50) levy in economy class and a €40 ($55) levy in business and first class. This levy will be collected through the airlines. Its revenue is estimated at €200-million a year, and could supply anti-retroviral treatments to more than a million people in poor countries.

Many people will question the need for a new levy on air transport. Many will ask why official development assistance is not sufficient to finance the purchase of drugs for developing countries.

In 2000, the international community unanimously adopted the Millennium Development Goals: It committed to taking decisive action against poverty, hunger, ignorance, disease, gender discrimination and environmental destruction in the developing countries, with a view to achieving tangible results by 2015.

The poor countries have to improve governance and conduct sound policies. In return, the rich countries have to assume their solidarity responsibilities. So France is increasing its ODA, which will account for 0.5 per cent of its GNP by 2007 and 0.7 per cent by 2012. But, despite the increase in ODA and despite the world economic growth, we know perfectly well that our goals will not be reached at the current rate. We need to find at least an additional $50-billion a year between now and 2015 if we are to fulfill our commitments.

Facing such a challenge, France and many other countries have reached the conclusion that adequate resources cannot be raised through ODA alone. Many countries are having difficulties in fulfilling their commitments to raise ODA. Furthermore, traditional ODA does not offer sufficient guarantees in terms of predictability and stability, because it depends on the budgetary constraints of the donor countries.

Hence the idea to find new ways, less volatile and more predictable, to finance development. In 2004, six countries - France, Brazil, Chile, Spain, Germany and Algeria - issued a report confirming that innovative development financing mechanisms are politically realistic and technically feasible. They presented a menu of options, including international solidarity levies, International Financing Facility, income from migrant remittances, voluntary contributions etc.

On Sept. 14, during a United Nations summit in New York on Millennium Development Goals, 79 countries, including European, emerging and developing nations, supported an ambitious declaration on innovative sources of financing.

Among possible initiatives, the air-ticket levy appeared to be the step that could be taken in the simplest and quickest way. France has decided to start the ball rolling. Some of our partners (Chile, Britain and Brazil) have adopted similar measures, and other countries will follow soon.

We are confident that the air-ticket levy will quickly show its effectiveness. It is easy to implement and fair (it will not distort competition) and has almost no economic impact (it will not harm the air-transport industry). It will make it possible to raise large funds on a regular basis.

Of course, innovative development financing mechanisms such as the air-ticket levy will be more effective once a greater number of countries participate.

This week, France is playing host to a conference whose purpose is to strengthen the consensus on the need to implement new development financing mechanisms (particularly international solidarity contributions), to enrich ongoing projects (especially the air-ticket solidarity levy), to start talks about the possibility of earmarking revenue from this levy to the fight against pandemics and to determine the next steps. This conference will be attended by nearly 100 countries, as well as international organizations and NGOs.

Canada has not signed the Sept. 14 declaration. But it has been invited to attend this conference as an observer, given its influence in international forums and the special audience it enjoys in debates regarding development aid and the fight against AIDS and other pandemics.

We expect that the Paris conference will allow the international community to tackle one of the major challenges of our times.

Daniel Jouanneau is France’s ambassador to Canada.

Source : The Globe & Mail - Online 28/02/06

Last modified on 16/06/2008

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