Should international aid serve Canada's commercial interests?

The Harper government's plans to merge CIDA and DFAIT have provoked considerable debate this week on whether it will result in a more coherent foreign policy and whether it means Canada is departing from stated policy on international aid.

Mixed views on merging CIDA with Foreign Affairs

The Harper government's plan to merge CIDA, the Canadian International Development Agency, with the Department of Foreign Affairs and International Trade has provoked considerable debate in foreign policy circles.

The key issues are whether the merger will result in a more coherent foreign policy, and whether it means Canada might be departing from its long-held positions on international aid.

Oddly, while the proposal emanates from last week's budget, the proposed merger was not mentioned in the budget speech but was buried deep in the Budget Plan, in a chapter entitled "Supporting Families and Communities."

What the budget says is that a new Department of Foreign Affairs, Trade and Development will bring "enhanced policy coherence" to those three policy areas.

The worry among some close observers is that a country's trade and foreign policy interests do not always align with its assistance goals.

But they do like the fact that the budget also states that "government will, for the first time, enshrine in law the important roles and responsibilities of the minister for development and humanitarian assistance."

Minister of International Cooperation Julian Fantino says that his government will maintain the mandate of poverty alleviation and humanitarian support., after the CIDA-Foreign Affairs merger. (Frank Gunn/Canadian Press)

Julian Fantino, the current minister of international co-operation, says that the government "will maintain the mandate of poverty alleviation and humanitarian support" in the new merged department.

That would be a reference to the Official Development Assistance Accountability Act, passed in 2008, which requires that Canada: "contributes to poverty reduction; takes into account the perspectives of the poor; and, is consistent with international human rights standards."

Meeting that second requirement is the one that merger skeptics worry about.

Commercial interests

Canada is also an adherent to what's called the Paris Declaration by the Organization for Economic Co-operation and Development, which sets out five principles for donor countries to follow.

Among them, that "developing countries set their own strategies for poverty reduction, improve their institutions and tackle corruption." Donor countries should then align behind that strategy.

However, Fantino's explanation that the reason for the merger is "to enhance co-ordination of international assistance with broader Canadian values and objectives," seems to be going in a different direction, according to skeptics like Roy Culpeper, the former CEO of The North-South Institute, an Ottawa think-tank, currently a professor at Carleton University.

He told CBC News that the merger, "seems to be an attempt to fuse Canadian commercial interests and Canadian aid policy."

He points to Canada's mining industry, a global leader.

The federal government has been working more closely with the industry in developing countries to carry out assistance programs.

By using aid dollars "to advance the commercial interests" of Canadian mining companies, Culpeper says the government "loses sight of the basic fact that aid is principally for the benefit of developing country partners, not for the rich country donors or their private sector interests."

For Culpeper, aid is all about helping the poor "transform their lives and prospects for the future."

A welcomed marriage

In an op-ed published Wednesday in Embassy magazine, Gerry Helleiner of the Munk School of Global Affairs at the University of Toronto, argues that "when there are two policy objectives, efficiency requires that there be two policy instruments to pursue them."

The Harper government plans to merge CIDA into DFAIT in order 'to enhance coordination of international assistance with broader Canadian values and objectives.' Newly arrived Somali refugees wait outside a UNHCR processing center at the Ifo refugee camp outside Dadaab, Kenya, Aug. 5, 2011. (Jerome Delay/Associated Press)

In this case, he says, "it is unquestionably best for Canadian commercial objectives to be pursued via governmental institutions and policy instruments other than development assistance.

"Otherwise confusion and dispute over aid policy and declining public support for it are bound to ensue."

Taking a different position, Janice Stein, the director of the Munk Centre, expressed support for the merger, because "our representatives will be singing from the same songbook," and thereby increasing Canada's influence and impact around the world.

Writing in the Globe and Mail, Stein lamented the different silos of Canadian foreign policy.

With amalgamation, she said, "Canada will no longer be running two separate programs – one led by our ambassador and the other by the senior CIDA official working out of the [same] embassy."

Two former foreign affairs ministers, Barbara MacDougall, a Conservative minister in the Brian Mulroney government, and Lloyd Axworthy, a Liberal from the Jean Chretien and Pierre Trudeau eras, also expressed support for the merger.

So does Paul Chapin, a former director general for international security at DFAIT, who calls the merger an "important transformation ... which could dramatically enhance the impact of Canadian foreign policy."

The 'church of CIDA'

Writing in the Ottawa Citizen, Chapin caustically argued that, with the rise of CIDA, which dates to 1968, "the country that had valued the hand-up now revered the hand-out."

Afghan widows plead for the continuation of food distribution during a demonstration at a food distribution centre in Kabul March 6, 2006, after CIDA cut funding, according to CARE International. (Reuters)

"Protected by an aura of sanctity (the only disinterested party looking out for poor countries) and with coffers full, the 'church of CIDA' could proceed with its pious mission to eradicate poverty in the world," he said.

As Chapin notes, development assistance has been administered from inside Foreign Affairs in the past and this is certainly not the first time the government of the day has tried to put CIDA back inside the department. The Conservatives recommended it when they took power in 2006, according to Derek Burney, who headed Harper's transition team.

The possibility exists, Julia Sánchez, the CEO of the Canadian Council for International Co-operation, a coalition of NGOs, writes in Wednesday's Embassy magazine, that "the amalgamation could result in a more effective agency to deliver official development assistance in developing countries."

Indeed, some countries with stellar reputations as donor countries, such as Norway and Sweden, have their development assistance, foreign policy and trade programs in the same government tent.

Canada and the Commitment to Development Index

The index, from the Centre for Global Development in Washington, ranks 27 wealthy countries on how they well do at helping poor countries. Canada ranks in about the middle.

Denmark, Norway and Sweden are at the top, while South Korea, Japan and Poland sit at the bottom of the list.

The index looks at seven criteria. Migration is the one in which Canada gets its most points, for supporting immigrants from developing countries and refugees from humanitarian crises.

On the environment, the centre gives Canada the lowest mark of all 27 countries.

(For his part, Culpeper noted that in both those countries the amalgamation did mean "some compromise in terms of accommodating commercial interests.")

On the other hand, the U.K. has an independent department for international development. In its budget last week, Britain's Conservative government projected a huge increase in international assistance spending, with the goal of reaching the long-standing UN target of .7 per cent of gross national income this year.

Canada's aid spending sits at about half the target, or around .34 per cent.

As Sanchez notes, "the devil will be in the details of how the merger is implemented, what the new legislation dictates as the new minister's roles and responsibilities."

But Stephen Brown of the University of Ottawa, and the editor of the 2012 book, Struggling for Effectiveness: CIDA and Canadian Foreign Aid, writes on a university blog that "there is actually no reason to believe that the new DFATD megalith will deliver aid any more effectively than CIDA."

He argues that "the Liberals and especially the Conservatives have politicized CIDA programming and used it to support strategic and commercial goals."

He goes on to say that "past experience has shown that such behaviour only hampers aid effectiveness at fighting poverty — and usually doesn't achieve the other objectives either."