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Canada is reworking the 'Dead Aid' model of foreign policy

How one of the world's top 10 aid contributors is rethinking its mission in the global arena.

Haitian children wait for aid to be delivered by Canadian and U.S. military; Photo by Erik C. Barker

Recently, the Canadian International Aid Agency (CIDA) merged with its cousin the Ministry of Foreign Affairs and Trade. Some may call this streamlining, or aligning of Canada’s investment interests (as if interests across two sectors are not intertwined enough—not to mention the number of related incestuous connections that actually predict more coordination).

Perhaps, the decision was more strategic. Or, Canada is considering the range of criticism that has been shared by development economists like Paul Collier, Jeffrey Sachs, and Dambisa Moyo, who are pushing the development goals through a more hybridized form of alleviating poverty that pulls from entrepreneurship models while “socializing” institutions to absorb private sector principles.

Since Canada is among the top ten global aid donors, the merger is not just a bureaucratic shift. It bespeaks a larger trend of re-prioritizing how and what kind of aid will be given. The implications are global and will be more particularly felt among Canada’s top recipients of the 5 billion dollars in aid (2009-2010 figures): countries, mostly in Africa and, a little farther away, Afghanistan.

Not long ago, the U.S. also collapsed its development aid agency into its foreign affairs agency at the U.S. Department of State during the second Bush administration. At that time, the critics voiced their concern that foreign aid giving would become more politicized while supporters argued for better coordination of interests—as in Canada’s case.

Pitfalls of traditional aid

Traditional aid is no longer helpful, as once believed, for two big reasons. Aside from the necessity of emergency relief aid for disasters, aid, as a tool for poverty alleviation or even political stability, has proven contradictory, if not disastrous. The first reason is presented by the best-selling author of Dead Aid, Dambisa Moyo. More importantly, as a development economist, Moyo reviews how traditional aid overlooks the root causes of poverty. Consequently, growth rates in Africa have actually declined.

Ironically, those who criticize Moyo’s criticism of aid miss her point. For example, in Dead Aid, when she writes that Aid fosters a military culture" one critic challenges her conclusion without considering what exactly transpired in Iraq and Afghanistan. Both countries serve as examples of financial aid giving growing dependent on a military culture—specifically, dependent on maintaining a secure environment, which gave birth to the common practice of hiring private security contractors.

Moreover, aid giving is not even efficient as corruption remains, which is highlighted in White Man’s Burden: Why the West's Efforts to Aid the Rest Have Done So Much Ill and So Little Good. No matter how offensive the title, the point remains valid as again described in The Bottom Billion: Why the Poorest Countries Are Failing and What Can Be Done About It, by Paul Collier.

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