Bill Gates donates $20 billion; plans to exit world's richest list

Microsoft cofounder Bill Gates is donating $20 billion to the Bill & Melinda Gates Foundation as the non-profit looks to increase spending from nearly $6 billion per year before Covid-19 to $9 billion per year by 2026.

"I will move down and eventually off of the list of the world's richest people," Gates says in a blog post, adding that the "great crises of our time require all of us to do more".

"My plan is to give all my wealth to the foundation other than what I spend on myself and my family," the world's fourth richest person says.

Over the past two decades, the Gates Foundation has gone from spending around $1 billion per year to spending nearly $6 billion per year.

"During the pandemic, Melinda and I approved spending an additional $2 billion so we could help with the Covid response without taking money away from other important work that we fund. (Of this commitment, $1.5 billion had been spent by the end of 2021, with remaining commitments of up to $500 million that have not been disbursed.) At the time, we expected the extra spending to stop once the acute phase of the pandemic was over. But it is now clear that the need in all the areas where we work is greater than ever," Gates says.

"For this reason, rather than returning the foundation's budget to pre-pandemic levels, we will continue to expand it. With the support and guidance of our board, the Gates Foundation intends to increase spending from nearly $6 billion per year before Covid to $9 billion per year by 2026," he adds.

"Our focus will remain the same—but at this moment of great need and opportunity, this spending will allow us to accelerate progress by investing more deeply in the areas where we are already working. To help make this spending increase possible, I am transferring $20 billion to the foundation’s endowment this month," Gates notes.

Acknowledging the donations made to the Gates Foundation by billionaire investor Warren Buffett, the Microsoft cofounder says although it is named the Bill & Melinda Gates Foundation, basically half of the resources to date have come from Warren Buffett's gifts.

"Since 2006, Warren has gifted the foundation $35.7 billion, including his most recent gift of $3.1 billion in June. The actual value of these gifts is about $45 billion if you include the appreciation of the Berkshire Hathaway stock after it was given. Warren's advice and thinking influenced the foundation in a profound way even before he made any gifts," he says.

On the Russia-Ukraine war, Gates says it is a gigantic tragedy for the entire world. "The reduction in the supply of natural gas is driving up costs, such as the cost of electricity, particularly in Europe. The reduction in the supply of food—particularly wheat and edible oils—and the supply of fertiliser is driving up food prices, which will increase malnutrition and instability in low-income countries," he says.

"The world economy is entering a low-growth cycle, with rising interest rates and high inflation. Deficit spending will have to be reined in to reduce inflationary pressure. Government income will go down and more will be spent on interest payments, which will reduce the amount of money available for programs and make trade-offs necessary. Aid budgets will be stretched, and the poorest countries may see support cut at the time when they need it most. Many low- and middle-income countries have unsustainable levels of debt, particularly as their currencies weaken against the currencies they have borrowed in. Reducing these debts will be particularly hard because a significant portion of them is owed to China and the private sector, rather than traditional development banks, which makes it much more challenging to negotiate debt relief," he adds.