Tuesday, November 13, 2012

Canada works on trade instead of aid

Under the administration of Stephen Harper, Canada's government has made a big change on how it interacts with Africa. Simply put, they have concentrated more on trade than on aid. The focus on trade has ignored some African countries at the expense of others. Canada is doing trade primarily with resource rich nations such as Ghana and Nigeria for their minerals and oil. Meanwhile, the poorest countries on the continent are almost ignored by Canada. Still, such an approach can only accelerate Africa's economic growth.

From the Inter Press Service, writer Fawzia Sheikh takes a look at the pros and cons of each approach.

The Canadian International Development Agency ended bilateral programming in countries where aid efforts are hindered by high operating costs, including Rwanda, Zambia, Zimbabwe, Malawi and Niger. The agency also decided to reduce and concentrate its bilateral programming in five states, including Mozambique, Ethiopia and Tanzania.
Yet last month, after years of viewing the continent as mainly a foreign aid recipient, the Conservative government announced a trade mission slated for next January encompassing the extractive resource industries and the infrastructure sectors related to energy, power generation and mining.
The new-found attention is not that surprising, given that Africa appears to be in the midst of an upswing.
Between 1995 and 2010, Africa’s annual average GDP growth was 4.3 percent a year, making the continent one of the fastest-growing regions of the world, Rudy Husny, press secretary to Ed Fast, the Canadian minister of international trade, wrote in an email to IPS. Solid economic growth is expected to continue this year and in 2013, he noted.

According to a report by the Organisation for Economic Co-operation and Development issued earlier this year, the drop in Canada’s overseas development assistance since 2011, as well as a decision to zero in on fewer countries that are predominantly middle income, “may undermine the support (Canada) has given in recent years to poor countries with weak capacity, especially in sub-Saharan Africa.”
In 2011, Canada’s net overseas development assistance fell to 5.3 billion dollars, a decrease of 5.3 percent from 2010, states the peer review published by the OECD’s Development Assistance Committee.
In the report, the OECD advised that Canada and other nations must ensure that development objectives and partner country ownership are key to the programmes it supports, and that there is “no confusion” between development aims and the promotion of commercial interests.

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