Goosby warns of need for long-term funding commitment for AIDS, says financial trades tax is 'interesting'

Keith Alcorn
Published: 17 February 2010

International donors need to start looking at a 30 to 40 year time frame for 'long-term sustainable support' to manage the global response to AIDS, US Global AIDS Coordinator Eric Goosby told a press conference on the opening day of the Seventeenth Conference on Retroviruses and Opportunistic Infections (CROI) today in San Francisco.

He also said that US officials charged with global health are looking with great interest at a new proposal from non-governmental organisations for a financial transaction tax to raise money for global health and development.

A 0.05% levy on financial transactions such as currency trades and financial derivatives might raise $150 billion per year, campaigners say, and largely affect speculative trades of 'no economic value', according to UK Financial Services Authority regulator Adair Turner.

A transaction tax is gaining international support from influential figures as a means of providing an insurance fund against future bank crashes. The German Chancellor Angela Merkel and French President Nicolas Sarkozy have endorsed the proposal, as has British Prime Minister Gordon Brown.

Some of the money raised would repay the vast sums used by governments to stabilise banks during the 2008-2009 crisis, or form the basis of an insurance fund that would protect against future banking crises.

However advocates are also proposing that the tax could generate substantial funds for global development. This position has not yet been endorsed by governments, but a growing civil society campaign is attempting to build support for a 'Robin Hood' tax that would be split between global and domestic priorities.

However for a tax to be implemented, it will need to garner support from most of the G20 group of major economies that includes China, India, Brazil and Russia, together with the United States.

Ambassador Goosby’s comments are the first hint that figures in the US administration are looking seriously at the transaction tax as a means of generating financial support for global health. Up until now any interest in a tax on banks was thought to focus on taxes on individual banks as a means of establishing an insurance fund against future bank crashes.

"We are very interested by innovative strategies and we're looking at this with great interest…This could be a big one,” he said.

However he emphasised that the US was also looking for ways to maximise support for multilateral partners, a coded reference to the fact that European governments – particularly France, Germany and Italy – have a persistent track record of low contributions to the Global Fund proportionate to their economic output.

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