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When Policy Coherence is a Bad Thing

In July 2013, when the government abolished the Canadian International Development Agency (CIDA) and transferred its functions to the newly renamed Department of Foreign Affairs, Trade and Development (DFATD), it did so mainly in the name of policy coherence. The government wanted to improve coordination among the various components of foreign policy, thereby increasing its effectiveness—which could potentially be good news for poor people around the world. In fact, soon after the decision was announced, the then-Minister of International Cooperation, Julian Fantino, stated that one of the central goals of the merger was “to put development on equal footing with trade and diplomacy”. One supporter of the merger, Scott Gilmore, stated that it “means that those trade commissioners are now going to understand how to make their trade deals more pro-poor, and how they can use tariff reductions, for example, in sub-Saharan Africa as a major catalyst for agricultural growth”.

Rather than giving development an “equal footing”, CIDA’s absorption into DFATD in the name of greater policy coherence has further marginalized development concerns.

By law, according to the 2008 Official Development Assistance Accountability Act, the central focus of Canadian foreign aid must be poverty reduction. However, as mentioned in a previous blog post, even before DFATD swallowed up CIDA, the latter was having trouble defending its poverty-reduction mandate. Fantino himself repeatedly emphasized the “need” for Canadians to benefit from Canadian foreign aid. In a heavily redacted version of a March 2013 internal review of CIDA programming obtained by the Globe and Mail, the “bottom line” for each country  (when not completely blanked out) usually invokes Canadian commercial interests to justify current or increased aid levels and makes no reference to development needs or poverty reduction. Critics of CIDA’s absorption into DFATD worried that the new institutional arrangement would further reduce Canada’s commitment to development issues.

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 What impact has development’s “equal footing with trade and diplomacy” had on Canadian foreign policy? So far, none at all, if one is to judge by the Global Markets Action Plan, DFATD’s only policy paper since the merger. Released in November 2013, the plan presents “economic diplomacy” as the Canadian government’s overarching foreign policy goal and promises to “ensure that all Government of Canada diplomatic assets are harnessed to support the pursuit of commercial success by Canadian companies and investors”. It contains no mention of any benefit for poor people or developing countries. Its only reference to Canadian foreign aid is the desire to “leverage development programming to advance Canada’s trade interests”. That is not to say that Canadian trade cannot sometimes benefit the global South as well. Not once, however, is that case made, nor is it ever suggested that such concerns played any part in developing this plan. Despite Gilmore’s optimism, there is no mention that trade deals, tariff reductions or any such policies will help reduce poverty abroad.

Perhaps in response to this important lacuna, Minister of International Development, Christian Paradis—who was appointed soon after CIDA’s abolition—made a speech in December 2013 entitled “Development as an Integral Part of Canadian Foreign and Trade Policy”. Like Fantino before him, even he, whose primary remit is international development, emphasized how the plan and the various components of foreign policy “[contribute] to Canada’s prosperity”. He did include a throwaway sentence on how, “[b]y stimulating the economy in these countries and helping them create an environment conducive to investment, we are contributing to the well-being of people living in poverty”. However, such short, rare, facile and eminently debatable statements hardly suggest that poverty reduction was actually a motivator, especially when his speech and the plan itself both focus almost exclusively on benefits to Canadian companies and investors. (For a more detailed analysis of Paradis’s speech, see the McLeod Group blog.)


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Using foreign aid to promote Canadian commercial interests is hardly new. In fact, the practice predates CIDA’s establishment in 1968. However, it has become increasing prominent in the past decade, despite the fact that donors’ focus on economic self-interest reduces foreign aid’s effectiveness. If our goal is to reduce poverty, we should focus on the best means available to do so. Sometimes poverty reduction can also be in the direct interest of the Canadian private sector. However, when the latter become the driver of Canadian development policy, we are perverting the goal of foreign aid, hampering its effectiveness, reneging on our international commitments to respect developing countries’ priorities and even breaking Canadian law.

Rather than giving development an “equal footing”, CIDA’s absorption into DFATD in the name of greater policy coherence has further marginalized development concerns. The Canadian government is right to promote Canadian commercial interests, but it should not use foreign aid funds to do so. Policy coherence can be a useful tool to achieve policy objectives, but in its current form it is betraying the stated justification for abolishing CIDA, and hindering, rather than helping, Canada’s development efforts.

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