The issue of financing reparations for historical injustices such as slavery and colonialism has become increasingly pertinent in recent times. There has been a growing momentum in calls for governments to provide restitution for past crimes, with many advocating for debt relief and redirection of financial sanctions as effective means to deliver reparations. This article aims to explore the various options recently outlined in a report, highlighting the potential of different financing mechanisms for reparations.
Nasim Salad, a senior associate at The Advocacy Team, co-authored a report on financial mechanisms for reparations, which emphasises debt relief as a crucial method, particularly for African countries. According to Salad, debt cancellation can free up significant resources, enabling countries to allocate funds towards their own social sectors. The report also recommends repurposing financial sanctions to redirect assets from perpetrators to victims, citing fines collected from violators as a potential source of funding for development projects in affected countries.
Taxation is identified as a key opportunity for generating reparations, with financial transaction taxes (FTTs) being singled out as a highly effective means to achieve large-scale financial restitution. The report estimates the potential of an FTT, revealing that a moderate tax of 0.1 percent on the $16 trillion traded on the global financial market daily could generate up to $16 billion. However, the report emphasizes the importance of adopting a combination of different measures to ensure sustainable impact.
Advocates for reparations argue that the wealth accumulated by merchant banks, insurance companies, and individuals in European nations was built on the exploitation of slavery and colonization. This has resulted in lasting harm for countries like Haiti, which was forced to pay steep compensation to France after overthrowing French colonizers in 1804, and continues to struggle with poverty today. The African Union has declared 2025 as the year of “Justice for Africans and People of African Descent Through Reparations,” with a focus on exploring legal and judicial options for reparations for trans-Atlantic enslavement, colonialism, and apartheid.
This movement for reparations has gained support from grassroots activists, academic scholars, and some politicians, reflecting a growing global momentum for addressing past injustices. The United Nations human rights chief has also urged countries to enter “a new era” on reparations and take tangible steps towards redressing historical wrongs. These developments underscore the increasing urgency in finding viable methods to finance reparations and deliver restitution for historical injustices.