The growth of the global middle class could lead to nearly £150bn of additional worldwide charitable giving over the next 17 years, the Charities Aid Foundation claims in a new report.
CAF’s Future World Giving report was launched yesterday at the House of Commons, and predicts that if people in rapidly developing economies give as they do now the UK, giving could rise to $224bn a year (£146bn) by 2030.
The sum comes from OECD data which projects that the middle class globally will grow from 1.8 billion in 2009 to 4.9 billion people in 2030, a rise of 165 per cent, with their spending power set to grow by 161 per cent over the same period.
And CAF’s report says that if the world's middle classes match the average 0.4 per cent of spending donated to charity by people in the UK, the sum would be enough to wipe out the world’s extreme poverty. Seventy per cent of this growth is anticipated to arise outside Europe and North America, known as the traditional world centres of giving.
'Ultra-rich' on the rise
In addition, the report says that the world’s ultra-rich is also on the rise. The number of people worth $100m or more is predicted to increase from 63,000 in 2011 to 86,000 by 2016.
The report is part of a CAF project to analyse how governments can encourage this level of charitable giving, specifically by developing incentives to donate and building trust in charities by setting standards of transparency.
John Low, chief executive of CAF, pointed to how fast developing economies such as China, India and Brazil are growing.
“The massive expansion of wealth that will come from this social change means there will be vast untapped potential for people to contribute to causes in their countries and across the globe,” he said. “If the new middle classes give to charity like we do in the UK, the potential to transform the world for the better will be vast.
“Governments and civil society across the world need to harness these powerful social trends. We need to prepare for these changes now to make sure that people can support the causes they care about with confidence and ease".
In November 2012, CAF reported an increase in giving from major donors in the previous financial year, rising by 20 per cent between 2010/11 and the last financial year to reach £122.9m.
However, in CAF’s World Giving Index report, which it released in December, Low had warned of a ‘double-dip’ in worldwide giving. He called at the time on politicians, businesspeople and individuals to “take action now to support charities and enable them to carry on providing vital services”.