Norway supports proposed currency transaction levy

9/23/2010 // Norway supports the proposed levy on currency transactions. This will raise several billion dollars for additional funding for global public goods, such as measures to address climate change and to promote health, education and the UN Millennium Development Goals.

“Norway has taken an initiative together with France, Japan, Belgium, Spain and Brazil that could have huge significance for the achievement of the Millennium Development Goals,” commented Norwegian Minister of the Environment and International Development Erik Solheim at an event in connection with the UN General Assembly this week.

Norway supports the proposed introduction of a levy on currency transactions. Norway has also started efforts to mobilise support for a financial transaction levy to raise funding to meet global challenges such as sustainable development.

“If we can bring together enough countries that are willing to introduce a levy on their currencies, this can become a reality,” said Mr Solheim.

The proposed levy will be so small that there would be no dramatic change in the behaviour of the market. The level being discussed at present is a levy of 0.005% on international currency transactions. This would give an income of around USD 40 billion a year, depending of how many currencies are taking part. By way of comparison, USD 16 billion a year is needed to give all the 70 million children who still do not attend school an education.

“It is important that this discussion takes place in the only international body that includes all the countries in the world, namely the UN. Financial institutions have received huge bail-outs paid for by public money in connection with the financial crisis. Now it’s time for them to give something back to society,” said Mr Solheim.

An international group of experts has examined the idea of making the financial sector  subject to a levy in order to finance global public goods. These are goods that benefit all the countries in the world, but that few countries contribute to. Professor Thore Johnsen at the Norwegian School of Economics and Business Administration (NHH) has taken part in the group of experts.

You can find more information about the meeting in New York here.

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