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Canada and the World

        Current Events with a Canadian Perspective


Last update

24 January 2011

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Canada’s Foreign

Aid Effort Falling Behind


Canadians might see themselves as compassionate

souls, but some say Canada’s aid to

developing countries is nothing to cheer about


It is now several decades since Canada took the pledge; that was a promise to dedicate 0.7% of the nation’s Gross Domestic Product (GDP) to development assistance. That target was set by the United Nations as recommended in a Pearson Commission report in 1969 (Lester Pearson was Canada's Prime Minister from 1963 to 1968).

Umar Khan "Darweesh" / CIDA

Rebuilding in Kandahar. According to The Dominion “Afghanistan has been the single largest recipient of Canadian bilateral aid, with almost $1 billion allocated from 2001-2011.”


U.S. President Kennedy’s Decade of Development

This was also the decade when U.S. President John F. Kennedy proposed that the industrial nations make the 1960s the “Decade of Development” and pledged one percent of his country’s GDP to the effort. Many other countries also took the pledge but, so far, only five north European nations have hit the UN target - Sweden, Luxembourg, Norway, Denmark, and Holland.


Canada has never reached the target, but was at 0.49% of GDP in 1991. By 1999, Canada’s foreign aid had dropped to 0.30% of GDP, and currently, it ranks 16th out of 22 industrialized countries in its foreign aid commitment when measured as a percentage of GDP.


Failed Foreign Aid Pledges

In 1992 in Munich, Germany, the Group of Eight countries (Canada, the U.S., Britain, France, Germany, Italy, Japan, and Russia) committed themselves to increase the quantity and quality of development assistance and to direct it increasingly toward the world’s poorest countries.


But, 10 years later, Canada’s aid to the 49 least developed countries (LDCs) declined in real terms by almost 50 percent, to $180 million U.S. from $350 million in 1992.


For the G8 as a group, aid to LDCs dropped by 56 percent for the same period. During the same decade, not only had aid declined: the proportion of Canadian tied aid, aid the recipient must spend on Canadian goods and services, went up to 70 percent of the total from 44 percent in 1992. Some experts argue that to really help the poorest countries, aid should have no such ties.


Meeting Millennium Development Goals

By 2002, the World Bank estimated that developed countries needed to double annual aid, an increase of $50 billion U.S. a year, to meet goals agreed upon in 2000.


After the U.S. government announced plans to raise its aid budget by 50 percent - $5 billion U.S. - by 2006, and the European Union promised to increase its yearly aid by about $7 billion, Canada was under pressure to do the same. So, Prime Minister Jean Chretien said Canada too would boost its development assistance budget ($2.3 billion in 2002) by at least eight percent a year.


The February 2003 federal budget did include an eight percent increase in foreign aid spending - an extra $180 million - after many years of severe cuts. That’s short of the Throne Speech promise four months earlier when the government vowed to double Canada’s foreign aid budget of about $2.3 billion by 2010: that would require annual increases of about nine percent in each of the next eight years.


At this rate, it has been estimated that it will take until 2040 for Canada to meet its United Nations commitment of 0.7% of GDP. As far as Globe and Mail columnist Jeffrey Simpson is concerned Canada simply is not pulling its weight.


In January 2003, Mr. Simpson wrote that Canadians are living in a fantasy world if they see themselves as international do-gooders. Noting that Canada has shrunk its commitments to the world, he says we can make no claim to moral superiority. Despite the aid budget dollar increase, he says the real, after inflation, budget of the Department of Foreign Affairs is about 30 percent less than a decade earlier.



“Canadian Aid or Corporate Raid.” Harsha Walia, The Dominion, October 28, 2006.

“Aid Effectiveness, Mom and Apple Pie.” Stephen Brown, Canadian International Council, April 22, 2010.

“Despite Billions Wasted more Foreign Aid Needed: Oxfam.” Richard Foot, National Post, April 25, 2010.


© Canada and the World, January 2011

All rights reserved

“Billions of public dollars have been wasted on corrupt and ineffective foreign-aid programs over the past several decades, but even so, rich countries must fix such flaws and increase their spending on development aid, says a new report by Oxfam International.”


Richard Foot

Canwest News Services



The global shortfall in aid currently stands at $3 trillion based on the 0.7% of GDP pledge made by developed countries in 1970.




In February 2009, Ottawa announced it was concentrating its foreign aid in just 18 countries, down from the 25 that had been targeted under Prime Minister Paul Martin.


Rwanda, Cameroon and Kenya, Sri Lanka, Cambodia, Nicaragua and Guyana have been dropped.


According to a Canadian Press report “The following places have been added to Canada’s list of favoured recipients: Afghanistan, Colombia, Haiti, Peru, Sudan, and the West Bank/Gaza and Caribbean regions.”