Gates tells G-20 that aid to poor nations should continue

Billionaire philanthropist Bill Gates asked global finance leaders Thursday to prioritize international aid spending, arguing budget cuts would not only hurt the poor but undermine innovations in health and agriculture.

The Microsoft Corps cofounder, who has committed to give the majority of his wealth to charity, is the first private citizen to testify before the G-20, a group of Finance Ministers and Central Bank Governors that meets annually to discuss key issues facing the global economy. During a time when even the world's most well off countries are wrestling with budget cuts, French President Nicholas Sarkozy asked Gates to share ideas on how to finance international aid during this year's G-20 meeting in Cannes, France.

Many of the world's richest nations have pledged to increase funding for international aid in developing countries. But, so far, little progress has been made toward those goals. In the United States last year Congress sliced some $8 billion off foreign aid. This year, Washington is looking at chopping another $8.6 billion.

Gates argued international aid, which accounts for less than 1 percent of most donor countries' budgets, has had a "huge impact" and has the potential to not only reduce poverty now, but also propel poor countries down the path to self-sufficiency. "The world will not balance its books by cutting back on aid, but it will do irreparable damage to global stability, to the growth potential of the global economy, and to the livelihoods of the poorest people," Gates wrote in his report to G-20 leaders.

His ideas were met with enthusiasm from groups like Oxfam and the World Wildlife Foundation, which rallied in Cannes Thursday waving brightly colored signs, but many experts in international development aren't on his side. While the billionaire's report to the G-20 is filled with anecdotal evidence that the world is making big strides in the fight against poverty, other researchers argue an increasing percentage of aid is being funneled into the pockets of corrupt government officials.

Raising revenue for aid

Over the last 50 years, quality of life for those living the world's poorest countries has improved significantly, Gates argued. For many, Gross Domestic Product has risen and poverty rates have fallen. Advances in agriculture saved a billion lives. Thanks to advancements in vaccines, the death rate for children under the age of 5 has been reduced by 80 percent.

"Aid generosity has played an important role in these successes," Gates wrote.