The global economic crisis of 2008, and the stagnation and political crises that followed, have made us acutely aware that our future can no longer rely on relationships with other developed countries. The North (basically OECD countries) and the South (developing countries), rich and poor, must increasingly cooperate.
Our vocabulary and thinking is changing. We are moving beyond what we used to call “assistance,” the charitable response of richer nations to global poverty, to something less paternalistic. We now talk of “development cooperation.” Today’s assistance is multifaceted, and includes more than just financial and technical aid. It can include preferential tariffs on goods from the least-developed countries (LDCs); tweaking the legal frameworks defining what constitutes a refugee; and adjusting intellectual property rules to allow for preferential transfers of technology to LDCs. Development cooperation also encompasses a topic that is particularly hot today: fair payment of taxation by foreign investors, for example, a Canadian mining company operating in a poor African country.
As the federal government reviews its international assistance policies, it should be guided by this evolving vision of development, with financial aid as just one component. The UN Agenda 2030 for Sustainable Development will shape how the government approaches cooperation, seeing the countries it assists as partners in a collective mission to alleviate poverty, rather than mere recipients.
Building relationships through partnerships and enhanced development cooperation
Looking ahead, for political, commercial and security reasons, Canada will need to engage with a more complex array of actors. Some of these countries will be very poor. Our trading and investment partners are as likely to be emerging developing economies as they are familiar OECD countries. The BRICS and other middle-income countries (MICs) are already competing with the United States and other G-7 nations as economic actors. They are reshaping global markets as suppliers and buyers, sometimes as equity investors. The economies of these countries are growing much faster than ours is, even during this extended period of economic stagnation. Today’s BRICS superstar is India, which, despite its 300 million poor, is now growing at about 7 percent per year — faster than China.
Critically, more and more developing countries, even the poorest, are changing socially: they are more democratic, and their populations are better educated, with growing expectations of enhanced well-being for their sons and daughters. These expectations are often frustrated by Northern unwillingness to share old privileges and power that have been jealously guarded since the Second World War. One symbolic battlefield is around fairer, more representative governance of global institutions such as the IMF and World Bank. The battle, often driven by the BRICS, has led to the creation of several parallel global financial institutions. One recent (2015) dramatic step was the creation by China of its US$50 billion+ Asia Infrastructure Investment Bank. We saw most major European countries rushing to join as founding contributors, despite very public US objections. Canada belatedly asked China if it could join, after stalling for months under US pressure.
These rapidly changing power relationships between Southern and Northern powers yield a key message: Canada, as a middle power that was substantially absent from the global dialogue for a decade, has a lot of catching up to do. We need new friends, new partnerships in the world.
Obvious candidates are the BRICS, notably China, India and Brazil; but there are also emerging lower-middle-income developing countries (LMICs) such as Ghana, Vietnam, Indonesia, even Egypt or Nigeria. These and other nations could soon be important trade and investment partners for Canada. Of course, old neighbours and friends in the OECD and the G-7 will still be important, but they won’t be enough. Indeed, some of them are already ahead of Canada in building their own new South-facing partnerships.
An enhanced development cooperation approach is a key entry point, a place where we can build relationships and demonstrate our merit as a good partner, to show mutual respect and build trust. However, such partnerships require more than a 24-hour drop-by trade mission, with Canadian politicians desperately searching for a few deals to sign. We need sustained engagements on the ground, over decades, sharing in the struggles of partner countries to end poverty.
Canada was such an engaged partner for many decades. CIDA was the vehicle for our development cooperation activities since the late 1960s — activities that were seen as innovative (the first to provide funding for multiyear programs, rather than individual NGO-led projects) and generous (our aid level peaked at 0.54 percent of GNI in 1975 under Pierre Trudeau). But our leadership presence slowly faded, first from the austerity measures under the Chrétien government, then from the very ambiguous engagement of the Harper years, when our credibility as an innovative donor decreased. Programs became more politicized, and budget cuts sent overall international assistance to a low of 0.23 percent of gross national income (GNI).
But who now should be the beneficiaries of our development assistance? The 2030 United Nations Agenda for Sustainable Development’s core target is to eliminate extreme poverty. The extremely poor population largely resides within the LDCs. Unfortunately, the Harper era saw a distortion toward countries that were considered political or commercial favourites, rather than toward the LDCs. Looking forward, the poorest, still numbering about 1 billion, are in two overlapping country groupings. These are the 48 UN-listed LDCs and some 20 “fragile” countries that are vulnerable and conflict-afflicted, such as Haiti. An updated list of countries of focus for Canada is urgently needed, and it should consist mainly of LDCs and the fragiles. Our funding for LDCs should meet the UN aid target of 0.20 percent of GNI.
Aid focused on the poorest will meet our commitment under Agenda 2030’s signature principle of “No-one left behind.” However, it does not preclude development cooperation with a few middle-income countries with whom Canada has important strategic or historic ties, such as the Caribbean states. For them, there could be customized agreements, partnerships or actions that do not require diverting scarce aid. These could focus on arrangements around trade, investment, technology transfer and fairer taxation. They could include possible new cooperation instruments that seek to help engage the private sector, or so-called “triangular cooperation”: innovative aid projects involving partnerships between Canada, a new developing country donor such as Brazil or China, and an LDC or other poorer country.
The 2030 UN Agenda for Sustainable Development as our guide
The universality principle embedded in the preamble of Agenda 2030 brings development cooperation into the heart of Canadian domestic policy. It means all countries, developing and developed, are committed to the same goals as core economic and social performance targets. It is Canada’s statement of global solidarity. This “obligation,” essentially putting Canada on equal footing with developing nations, was once seen as an unacceptable intrusion by former Conservative foreign affairs minister John Baird.
There is a synergy between many of the 17 sustainable development goals (SDGs) and the Trudeau government’s core domestic policy commitments such as working toward gender equity, tackling neglect of our Indigenous population and fighting climate change. This synergy is being taken very seriously as a domestic policy mandate by many Western countries. Already the leaders of Germany and Finland have made full public presentations in the UN on their “whole of government” governance structures for SDGs. Canada has been slower to act, and we have yet to announce our plan. Logically it should be driven by a powerful office that reports directly to the prime minister, and coordinates and monitors activities in partnership with the provinces and territories.
Canada is now in the middle of a complex consultation, seeking new thinking on how to be a better development cooperation partner. Drawing upon Agenda 2030, there are easy-to-select thematic priorities such as gender equity, climate change and poverty elimination. But the real challenge is how we frame and implement the new programs. The rules of the game have changed. Under the Paris Declaration on aid effectiveness, recipient countries should be in the driver’s seat. Partnership is becoming the new norm of international development cooperation. We need to learn how to work differently: it is not a federal department’s choices but the recipient’s stated priorities that should dictate the framework for development cooperation. To this end we will need new cooperation strategies that are prepared jointly with our partner countries. Such strategies should be built around stable four- to five-year budget commitments.
All this means we need to recognize the many practical challenges confronting Canada’s aid officials and partners like civil society organizations. We could start by reclaiming the name CIDA (Canadian International Development Agency), the brand recognized by ordinary Canadians and our partner-recipients. Global Affairs Canada staff involved in implementing development programs need empathetic senior managers who understand that some of the most effective work is inherently risky. Tidy goals set in Ottawa often fail to internalize the challenges of working in another continent and culture. Finally, the government requires staff who are working closely with their clients on the ground. This requires decentralization — Global Affairs’ development assistance teams working out of our embassies with delegated authority.
As long as they are generous, and delivered effectively and with commitment, our development cooperation programs in the least developed and middle-income countries can be key to the future economic and political partnerships Canada needs as a middle power in a troubled world.
Photo: Nataly Reinch / Shutterstock.com
This article is part of the International Assistance special feature.
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