THE STANDING SENATE COMMITTEE ON FOREIGN AFFAIRS AND INTERNATIONAL TRADE
EVIDENCE
OTTAWA, Wednesday, February 7, 2024
The Standing Senate Committee on Foreign Affairs and International Trade met with videoconference this day at 4:14 p.m. [ET] to study and report on Canada’s interests and engagement in Africa.
Senator Peter M. Boehm (Chair) in the chair.
[Translation]
The Chair: My name is Peter Boehm. I’m a senator from Ontario and the chair of the Committee on Foreign Affairs and International Trade.
[English]
The Chair: Before we begin, I wish to invite committee members participating in today’s meeting to introduce themselves, starting on my left.
[Translation]
Senator Gerba: Amina Gerba from Quebec.
[English]
Senator Ravalia: Mohamed Ravalia, Newfoundland and Labrador.
Senator Coyle: Mary Coyle, Antigonish, Nova Scotia.
[Translation]
Senator Woo: Yuen Pau Woo from British Columbia.
[English]
Senator Boniface: Gwen Boniface, Ontario.
Senator M. Deacon: Marty Deacon, Ontario. Welcome.
Senator McBean: Marnie McBean, Toronto.
Senator Cardozo: Andrew Cardozo, Ontario.
Senator Al Zaibak: Mohammad Al Zaibak, Ontario.
Senator Richards: Dave Richards, New Brunswick.
The Chair: Thank you very much. I want to offer a special welcome to our two new senators — Senator Al Zaibak and Senator McBean — for joining us today. This is day 2 for them. I’m glad they have chosen this excellent committee in which to participate. Thank you for being here. I welcome you.
I want to welcome everyone across the country who might be watching us today on SenParlVU.
Colleagues, we are meeting today to continue our special study on Canada’s interests and engagement in Africa, and we are doing so in the context of International Development Week, which is taking place from February 4 to 10 this year.
Today, we are pleased to welcome, from the organization ONE, Elise Legault, Canada Director. We’re particularly delighted to have Stanley Achonu with us, who is the director who has come from Nigeria, not necessarily to be with us today, but we’re taking advantage of his presence to invite him to appear. And from Cuso International, we welcome Nicolas Moyer, Chief Executive Officer. Thank you very much for being with us.
Before we hear your remarks and proceed to questions and answers, I wish to ask members and witnesses in the room to please refrain from leaning in too closely to your microphone or removing your earpiece while you are doing that and your microphone is on, because this will avoid any sound feedback that could negatively impact the committee staff and others in the room, especially our interpreters, who will be wearing an earpiece for their work in interpreting us.
[Translation]
We’re now ready to hear your opening remarks. We’ll then open the floor to questions from the senators, as usual.
Ms. Legault, you have the floor.
Elise Legault, Director, Canada, ONE: Thank you.
[English]
Good afternoon. Thank you, senators, for inviting us to appear before you today. I am Elise Legault, the Canada Director for ONE.
ONE is a global organization co-founded by Bono from U2 20 years ago. Poverty, inequality, climate change, preventable diseases — we speak out to tackle these injustices, and we do it with colleagues from around the world, including many from the African continent. I am pleased to have Stanley with us today, who came all the way from Nigeria specifically for this committee, I promise you. Stanley is better placed than anyone to talk about Canada-Africa relationships.
Stanley Achonu, Nigeria Director, ONE: Good afternoon, everyone. I am deeply grateful to be here to address you today and to be invited by this committee. I extend my sincere appreciation to the chair and members of this committee for having me.
As a proud Nigerian, it is indeed an honour to share my perspective with you all, especially as I arrived in Canada last week. I must admit, I have enjoyed the unpredictable Canadian winter. It has been good.
The African continent, rich in diversity and potential, stands at a pivotal moment in history. We have all heard the statistics. It is one of the fastest growing workforces, the youngest population, coupled with economic growth rates that outpace those of G7 and European countries. Governments and private sector entities around the world are looking to capitalize on the potential that exists on the continent and investment opportunities. However, let us underscore a crucial point: The interest in Africa must be a partnership grounded in modernity, one that is forward-thinking and, above all, of mutual benefit. We, as Africans, seek not just charity. We seek genuine, equitable partnerships.
Amidst Africa’s promise lies a convergence of challenges: escalating living costs, as you know; a mounting debt crisis; and the devastating impacts of climate change, one of the biggest challenges on the continent at the moment. It is paramount that any partnership that addresses these pressing issues while fostering sustainable development must be anchored in equity.
The Canada-Africa strategy, something I have heard so much about in past few months, holds immense potential for both Canadian and African stakeholders. Unlike other global players, Canada’s history in Africa is devoid of colonial baggage, offering a unique platform for genuine collaboration. Moreover, Canadians’ intrinsic values of fairness and equity would serve us all as guiding principles in shaping this partnership. The reputation of Canada, both domestically and internationally, serves as a beacon of trust and integrity, a foundation upon which meaningful partnerships can be built.
For this partnership, I propose four fundamental pillars.
The first pillar is investment in infrastructure, with a particular emphasis on renewable energy. It is the key to unlocking Africa’s vast potential. Addressing the infrastructure deficit is essential for driving economic growth and fostering sustainable development on the continent.
Second is building resilience to climate change and enhancing food security to safeguard Africa’s future and prevent famines and droughts. As front-line victims of the climate crisis, African nations require robust support mechanisms to mitigate the adverse effects of climate change.
The third pillar is facilitating access for businesses and promoting decent job creation on the continent. As I mentioned, Africa’s youth population needs opportunity for meaningful employment, ensuring long-term stability and prosperity.
Lastly, we call for enhancing health security, as underscored by the recent global pandemic. Strengthening health care systems and building up disease prevention efforts are imperative for safeguarding public health on a global scale, not just on the continent.
However, these ambitions require substantial investment, yet access to affordable financing remains a significant impediment on the continent. The exorbitant interest rates imposed on African countries are unjustifiable. They are perpetuating a cycle of financial inequality. Industry experts and studies indicate that interest rates available to African countries are at high levels that are not supported by the available data on risk. This perception that investments in Africa are always riskier is not supported by any facts. This is the problem.
But I am not here to talk only about the problems. I propose five major solutions available to Canada to help Africa tackle this challenge.
First, help make multilateral development banks, or MDBs, bigger and better. These banks were created for the specific purpose of providing low-cost financing to developing countries, and they must be modernized. Canada has been supportive of the effort to modernize the MDBs, but we need more urgency, as we have seen in Zambia.
Second, the International Development Association, or IDA, will have a replenishment at the end of this year, and it is one of most cost-effective ways that Canada can help provide low-cost financing to the continent. I urge Canada to be ambitious in its commitments to IDA.
Third, FinDev — Canada’s development finance institution, or DFI — should have a strong role in the Canada-Africa strategy, similar to what was put in place in the Indo-Pacific Strategy, by tripling the capital for FinDev.
Fourth, continue strong support for really effective global health organizations, such as the Global Fund to Fight AIDS, Tuberculosis and Malaria, and Gavi, which are essential to supporting African countries to fight preventable diseases.
Fifth, official development assistance, or ODA, still has a major role to play. Prime Minister Trudeau had pledged to increase international assistance every year, made a commitment to the Sustainable Development Goals, or SDGs, and promised to invest at least 50% of Canada’s ODA on the African continent. These promises to the world should be kept. They are at risk in the coming years if strong support is not provided.
Africa’s economic development holds significant potential for global growth, and Canada’s absence could be a missed opportunity. Notably, other countries are already recognizing this about Africa and increasing their presence through various partnerships. I can give you examples.
The Chair: Excuse me, Mr. Achonu. You have gone over your opening statement time. Thank you for your remarks.
I would like to acknowledge that Senator MacDonald of Nova Scotia has joined us.
We will go to Mr. Moyer for his comments.
[Translation]
Nicolas Moyer, Chief Executive Officer, Cuso International: Good afternoon, everyone. I would like to start by thanking the committee for the invitation to speak to you.
Cuso International was founded 63 years ago by Canadians who felt deeply that this country could contribute a great deal to global progress. We see collaboration as the model for our work. We work closely with local partners around the world in the public and private sectors and in civil society to address the root causes of inequality and to improve the economic and social conditions of marginalized groups. We do so by focusing on three areas. These areas are strengthening equality and social inclusion, creating economic opportunities and promoting climate action.
Our work covers all these areas of activity. However, Cuso is often best known for its history of volunteer cooperation. Sharing skills remains an important way for us to make an impact in the communities where we work. Over the years, we’ve dispatched over 14,000 volunteer cooperants to more than one hundred countries.
We continue to work with Global Affairs Canada to implement Canada’s Volunteer Cooperation Program. We’re currently working in 17 countries, including six in Africa, and 48 of our 88 current cooperants are also in Africa.
[English]
As you have heard or will hear through your proceedings and committee hearings, for a range of strategic reasons, it is clear Canada must recommit to Africa. Yet, despite a period of strong engagement over decades, it can be argued that the last two decades have really painted a picture of disengagement or a different sort of engagement, with a lesser level of priority than it could have had, to the point where, in some places, Canada’s presence and relevance have all but disappeared.
In some cases, you can point to our infrastructure as one illustration of that. Canada only has missions in two fifths of the 54 countries on the African continent, but that is only one example to point to.
The longer our distance with Africa persists, the more challenging it will be to repair the relationships and build on those for the future, even more so in the face of deepening influence by other global actors, whom we could talk about and who have prioritized engagement on the continent in a variety of ways.
Canada’s Feminist International Assistance Policy, or FIAP, demands that 50% of aid be directed to projects in sub-Saharan countries. Cuso is keenly aware of and is working to help address the systemic challenges of so many communities in that region. We unreservedly applaud this focus on the most marginalized. That’s how we focus our programming too.
With the added support provided through the FIAP, the African continent is seeing some very positive signs in the fight against gender inequality and discrimination. There is no doubt about that. The progress is especially consequential in the context of Africa’s demographic and economic surge. Africa’s infant mortality rate has been declining steadily for years. It’s a direct result of increased access to education and health services for women. There are fewer teen pregnancies and lower incidences of child marriage, all the areas covered by the FIAP.
However impactful those contributions, Canada’s undertakings in Africa should not be defined by a charity mindset or an aid policy. Indeed, let us consider that Canada needs Africa more than Africa needs Canada. There are over a billion people on that continent; we are only 40 million in Canada.
Canada must engage on multiple levels and adopt a clear and principled stance — no more talk by Canada about Africa or for Africa’s development. To be taken more seriously in Africa, for its word to be trusted, for its advice to carry weight, Canada needs to invest in partnerships. We need to organize international summits and conferences. We need to work to convene like‑minded allies and champion a long-overdue redefinition of our relationship with countries on the continent. That means shifting whole ways of thinking embedded in our bureaucracy and systems. Our sector calls this decolonization. It’s an area where we are all uncovering many lessons about more meaningful and impactful forms of collaboration.
Canada can be a leader on the African continent, if not with the power of its purse, then with conviction, coherence and long-term commitment to our partners. It actually sounds deceptively simple. It isn’t. It is a path that requires changing how Canada develops relationships. It means choosing partners carefully and strategically, embedding their interests in our decision making, being coherent across multiple policies and practices and resisting distractions, of which there are many, to change our directions.
While I have your attention, I do think it’s important to share that at Cuso we have a strong view on the importance of prioritizing engagement with civil society, that it should be a top priority as Canada embarks on any new direction or strategy, worthy of equal or greater attention than relations with public or private sectors. It is civil society that delivers change at a systems level with credibility, accountability and unparalleled cost-effectiveness. As we see time after time, our African partners are driving their own solutions and collaborating amongst themselves, with Canadian NGOs increasingly shifting to supporting roles.
[Translation]
The international cooperation sector is ready to contribute to this effort, as it has done in recent decades. I encourage Canada to build on the expertise and networks that we have cultivated over many years of engagement in Africa. They hold a wealth of potential.
Today’s conversation with this committee is an excellent step in that direction. I’m honoured and grateful for this opportunity to share Cuso International’s perspective.
Thank you. I look forward to participating in this conversation.
The Chair: Thank you for your comments, Mr. Moyer. Colleagues, I want to clarify that you have up to four minutes each for the first round, including questions and answers.
[English]
I’ll hold you pretty strictly to the four minutes. As always, the shorter you keep your preamble and the more precise you make your question, the longer the answer, usually. It’s just an observation I have made.
Senator Ravalia: Thank you very much to our witnesses.
My first question is for you, Mr. Achonu. Thank you for outlining your key priorities. Based on those, are there one or two areas that you feel we, as Canadians, should particularly target and leverage — given our own strengths in technology, health care and other sectors — to contribute to the developments within the continent?
Mr. Achonu: Thank you, senator. I think that, on the one hand, continue to support global institutions like Gavi and the Global Fund. They save lives. Vaccination, primary health care access, workforce management — all of that is crucial. Canada’s continuing support for those institutions would be really appreciated.
The second point is FinDev. I think that considering the nature of access to finance on the continent, helping to de-risk investment on the continent using Canada’s FinDev would be one way to provide support to the continent.
Senator Ravalia: Thank you very much.
If I could follow up with Mr. Moyer — and thank you very much for your work — I was born and raised in Zimbabwe, so I have very clear knowledge of the excellent work that you do.
Are there initiatives where you specifically target youth empowerment and leadership in the context of Canada’s engagement in Africa?
Mr. Moyer: Yes. In our case, we run many different kinds of programs. We focus on education, for example, in Ethiopia and helping young girls get to and through university. That’s one example of where we’re championing youth leadership.
It’s clearly important on the continent because a large majority of Africans are under 25. That really is where our focus needs to be.
Senator Ravalia: Are there are impediments that you come across or cultural, diversity issues that impact your ability to work in certain settings?
Mr. Moyer: Absolutely, of course. I think that working in any country is complex. To give you an example, we work to champion LGBTQ rights in the Democratic Republic of the Congo. Talking about the rights of gays and lesbians in Africa is complicated on many levels, but we have found ways to be able to do that, focusing on economic integration of marginalized groups. By creating programs that allow an on-ramp to employment and entrepreneurship for all marginalized groups, including a focus on LGBTQ groups, we’re able to do that.
Learning to navigate the complexities of cultural identification and exclusion is one of many elements of addressing inclusion, from our perspective.
Senator Ravalia: Do you maintain a database that you review periodically in order to reinforce some of the work that you are doing?
Mr. Moyer: Can I ask what you mean by “database”?
Senator Ravalia: Statistics in terms of the number of individuals, for example, who benefit from your educational initiatives.
Mr. Moyer: We do, but on a program-by-program basis. Education is not our primary way of working. It’s one of the vectors through which we contribute to change. When we develop a program, we’ll focus on the needs of the community, as they are defined. In some cases, we’ll focus more on economic opportunities, and in some cases more on educational institutions and support. We can get back to you on statistics.
Senator Ravalia: That would be very helpful.
The Chair: Mr. Moyer, if you are going to get back to us with any statistics, please send it through the clerk of the committee, Chantal Cardinal, who is right here beside me.
Senator Gerba: Welcome to Canada. You have come so far, and we are so pleased to have you.
[Translation]
Thank you all for being here and thank you for your comments and recommendations. Mr. Moyer had this to say:
[English]
“Canada needs Africa more than Africa needs Canada.” Thank you for reminding us of this.
[Translation]
Ms. Legault, you recently published an interesting analysis showing how international aid has decreased in Canada. You described the development of Canada’s international aid and focused on the 15% decrease. In your view, this decrease seriously undermines Canada’s credibility on the international stage. You referred to other countries such as the United States that are making tremendous efforts on the international stage. I would like you to comment on this analysis and tell me how Canada could strengthen its international cooperation.
Ms. Legault: Thank you for the question, Senator Gerba. Canada’s international aid is somewhat complicated. There have been some increases in recent years. However, these increases have come after many years of cutbacks. From a historical standpoint, we spend a smaller proportion of our gross domestic product, or GDP, on international aid than we did in the 1980s and 1990s. We also spend less than other G7 countries, for example.
In addition, what we’ve seen since 2020, resulting from COVID and the crisis in Ukraine... In the past two or three years, from 2020 to 2022, there was a significant increase. Money was invested in access to COVID vaccines in developing countries and in support for Ukraine. However, in last year’s budget, so in 2023, there was a 15% decrease. We’re back to pre-pandemic levels. Of course, this is worrying, because the crises keep mounting. For example, the war in Ukraine is having a major impact on food prices on the African continent. We haven’t seen the last of the consequences of COVID and the issues relating to education and health, in particular.
As the crises continue, Canada must keep increasing its aid. We were talking earlier about the government’s promise to invest 50% of international aid in Africa. In recent years, this target has almost been met. Given the crises in other parts of the world... Naturally, the government must respond to these crises. The concern lies in the fact that the situation on the African continent is being overlooked given the somewhat less immediate nature of the crisis. We’ve noticed that aid to Africa isn’t increasing, but is stagnating at the very least.
Senator Gerba: Thank you. Do I have another minute?
The Chair: No, unfortunately. Second round?
Senator Gerba: Second or third.
The Chair: A third as well? We’ll see. Thank you.
[English]
Senator Woo: Thank you to the witnesses, and welcome to Canada.
In recent years, there has been in some international cooperation circles the idea that international cooperation should distinguish between democracies and autocracies, or democracies and authoritarian states.
Do you think that democracy promotion should be part of Canada’s international assistance envelope for Africa?
Mr. Achonu: Yes, of course, democracy is important. There is no development without freedom. Anything other than democracy limits people’s ability to express themselves. Progress is built on freedom, so I think that should not be taken away.
I think there is a reason why people are having that conversation. In the region where I come from, we have seen all of the countries around Nigeria backsliding into dictatorship and military coups, and this is driven by economic inequality and lack of opportunity for a very young population. People are questioning opportunity versus democracy. Once democracy is not delivering on the promise, then people will look for alternatives.
In supporting democracy, we have to back it up with economic opportunities for those to whom we have made the promise that democracy will guarantee their future. I think that’s essentially where the issue is: backing democracy with economic opportunity.
Senator Woo: I have a follow-up question.
Mr. Moyer: Your follow-up question is where we should go because I fully agree.
Senator Woo: Do you think a democratic test should be part of a conditionality for types of assistance to African countries? How might that work? You talked about backsliding. Could that be a trigger to withhold assistance?
Mr. Moyer: I think there’s a lot of nuance to this topic. I would say that yes, we should be promoting the principles of democracy, human rights, freedom and freedom of expression, which are really building blocks to building the kinds of societies whose values we share and the future that we want to see in the world. I think we should be clear about our intentions about that. However, I don’t think we should exclude engaging with countries that don’t necessarily have all of the same values or structures in place, because we can support civil society that will champion this change.
I really want to emphasize that point because countries are all — Canada included — in the process of evolution. We need to invest with those who are willing to take that fight locally. Frankly, these are local champions for progress. It’s why I make such a strong call for civil society — because the academia, the culture icons and the cooperatives are all building the future, and they will eventually end up in positions of influence in their countries. Looking at what some of the leading indicators are that will contribute to successful democracies — whether that’s youth or civil society — is important.
We are in a context — some people talk about a new era of Cold War. I think some of that language is not very common in non-profits. But there is a certain reality about agendas that are competing in international development, and there is a lot of money on the African continent that is backed by countries that don’t share the values we have. If we want to envision a world where a rules-based order is one that represents our values as a country — where if the world does well, we will do well — we have to be investing in the partners who will make that possible.
We can’t impose it. That’s an important point. We can’t impose it. So how do we find the partners and champion them to pursue a democracy that may look different from ours? I think we have to acknowledge that, too.
Senator Woo: Thank you.
Senator M. Deacon: Thank you to all of you for being here in person today. We know we have much to do, but it’s great to see you here in the Senate building.
This was touched upon a little bit earlier, but I want to come back to that balance between promoting economic development in Africa and also promoting human rights, particularly in some countries. Specifically, I’m going to touch back again on the LGBTQ+ rights. More than half the African countries currently criminalize same-sex sexual activity. The death penalty is the punishment in some of them. We’ve seen African leaders target LGBTQ+ individuals for political gain — although it’s not unique only to Africa, I might say.
In our foreign and development policy, would pushing and advocating for the LGBTQ+ rights be putting the cart before the horse, so to speak? Should we hope that as we move forward, these human rights come about as a result of more economic and democratic freedom? Or is this something that Canada should be pushing hard on when we engage with African nations?
I think each one of you has a perspective on this, so I’m going to open it up to each of you.
Thank you.
Mr. Achonu: I think that rights are important, as I emphasize. That freedom is foundational for building economic empowerment. Would I say that should be at the front of your engagement with African countries? I think that building partnerships first will open the door for future conversations around rights. The rights you referred to are extremely important, as you shared. This is an endangered community, I would say. However, if you approach African countries from that perspective, you’re going to get the door shut in your face. It shouldn’t be on the front burner. It should be part of it. But if you make it the centre of diplomacy and engagement with African countries, it’s already dead on arrival, and you will get pushback immediately.
Ms. Legault: Thanks for this perspective, Stanley. I would add that maybe sometimes it can be easier for a country like Canada to talk about these more complex values or rights issues if you’re also backing your partnership with actual strong financial and diplomatic support — that you’re present on the continent. Once you show that you’re a real friend and a real partner, it might be easier to have those conversations than if we — I know that’s not what you or anyone is suggesting — just focused strictly on the rights and values without backing things up.
We have seen some feeling on the continent and elsewhere in the developing world that sometimes a wealthier country like Canada talks a lot and doesn’t necessarily act. Or they talk about equality and equity, but when it’s time to buy vaccines, we buy all the vaccines for us and don’t leave any for other countries. I think that feeling is still there from the pandemic. It’s the same thing about making promises around climate change and financial support and then not backing this up. I think we’ll be better placed to have those more complex conversations if we’re also there with financial support.
The Chair: I’m sorry, we’re out of time in that segment, but I’m sure it’s something we can come back to.
Senator Boniface: Thank you, particularly, for making the trip from Nigeria. I think we’re quite privileged to have you with us.
You spoke about investment in infrastructure. I’m interested in what type of infrastructure you’re talking about and also in relation to security issues. Could you speak to those issues?
Mr. Achonu: Yes. Every single time I talk to colleagues about how the West is responding to China’s presence on the continent, it is always viewed from the perspective of China recolonizing Africa. But there’s a reason why the door is open for China to come in. If you go to Lagos today and you take a train, it was built by the Chinese — even funded by a loan. If you are in Ethiopia as well, it’s the same. All over Africa, you see concrete infrastructure that you can point to. They’re not all gifts. They’re financed by China or built by Chinese companies through loans.
I can’t say that about the Western partners who want Africa on their side. That is what swells the popularity of these countries versus Canada. It doesn’t mean that Canada is not making those investments, but it’s how these investments are structured. Are there tangible things that Africans can point to and say they were built by Canada or done by Canada? I’m not saying this lightly. Canada saves lives. The investments made in critical areas like health are not fancy for that sort of purpose, but I’m saying there has to be some sort of matching of this kind of investment, of diplomacy and rights issues with infrastructure investment. Africa is already taking loans to build the infrastructure. Why is it not being financed by Canada or Canada-led businesses? Why is that not being guaranteed by Canada investment arms? Those are the things that would put Canada right in front and centre.
When you travel to the poorest of African countries, every major infrastructure development you see — road construction, bridges, water, housing — it’s China, right? An average citizen in those countries would say they are supported by China. They do not care about the details of the financing. They see China on that infrastructure.
I think there has to be a match, a combination of investment in infrastructure, advocacy for these rights and health issues that we complain about. That’s why I started by saying that investment in infrastructure would go a long way. It creates jobs and leaves opportunities on the table.
Senator Cardozo: Mr. Achonu, I’d like to pursue that issue a little bit further. Thank you very much; it’s quite enlightening. Thank you for coming all the way here. Just so you know, the rest of the year it is very hot. It’s very warm and sunny in Ottawa. This is just an unusual cold period we have.
China is building all this infrastructure, and everybody knows it’s doing that. Canada and maybe many Western countries are involved in programs, so you’re not seeing the name of Canada or other countries up in lights or on major infrastructure. Are we doing the wrong thing from a PR point of view, but doing the right thing for people? Part of that is what’s the quid pro quo for the West, Canada or China? My sense of it is that China’s quid pro quo is quite high, but we’re not totally innocent either.
Mr. Achonu: Of course, there has to be something in it for whoever makes these moves, be it China or Canada. This is why I’m advocating for investment led by the private sector. There is a return on investment. This is why I talked about de-risking opportunities so that Canadian businesses can take advantage of the things that the Chinese are doing, even though it is backed by the Chinese government. I understand that these two situations are not the same, but it’s not a quid pro quo kind of issue. The work that Canada is already doing is critical, as I’ve highlighted, but I’m saying that Canada needs to step up and be seen.
I described it the other day as a bit laid back in terms of the approach to the continent and other regions. I think Canada needs to step forward and be seen. Someone said something today that I think is interesting: Canada’s foreign policy is almost in the “friend zone” — if you have any Gen Z or younger kids, maybe they can explain the friend zone — but it seems like Africa is going to friend-zone Canada if the current approach remains. It’s lukewarm, more or less. That’s the way I would describe it.
Senator Cardozo: On the return on investment, what areas can businesses find return on investment, and how do we make that known to the private sector in Canada?
Mr. Achonu: Africa holds immense opportunity — agriculture, construction, finance — it feels like virgin land when it comes to where you can invest. Again, the concern that we have heard from the private sector here in Canada is that it is very risky, even though the data does not support the risk. This is why I’ve said that in order to make Canadian businesses invest in Africa, you need to think about how we can use government instruments to de-risk the perception of doing business in Africa.
Senator Cardozo: Such as?
Mr. Achonu: FinDev Canada provides some guarantees, some co-funding for projects and investment on the continent. Those are the ways you can show or give guarantees that I’m putting my money into what I’m asking you to do. It’s also about supporting smaller and medium-sized businesses on the continent, investing in financial institutions on the continent that can then lend to businesses, because access to credit is a big issue for creating opportunities on the continent. If you make funding available to financial institutions like the African Development Bank and financial institutions across the continent, they know this environment better than most, and they will be able to turn around those funds. I’m not saying it’s free money. This will make a return on your investment. Evidence shows that there is a return on investment if it is done right on the continent. As I said, it’s a virgin land.
Senator Coyle: Thank you to all of our guests for being here. It has been extremely helpful already and, as many of my colleagues, I have a real interest in everything you’re saying. Forty-four years ago, I started my career through Cuso in a placement in Botswana. It was 44 years ago last month, actually, so it’s really great to see how organizations like Cuso have evolved over time. And ONE has also evolved over time. Mr. Moyer and I also know each other from the Coady Institute.
You’ve talked about prioritizing engagement with civil society. I think this is something I’m really hoping we will delve into a lot in this study. It’s not one and done. Civil society is vast and varied. One of the things I’ve always found interesting about civil society is how innovative it is. When we talk about how Canada has something to learn, Canada has something to learn from the innovations of civil society organizations in Africa — I’d love to hear about that — as do our other partners around the world. If there’s anything you want to say about civil society as an incubator for any innovation — social, economic, technological innovation — I think it’s something that I’d like to hear a bit more about. Could you start with that?
Mr. Moyer: I can hardly do justice to all of the innovation that civil society can contribute. There are so many sides to this, whether you’re looking at the role of academia in supporting technology or intercultural exchange or knowledge exchange. You have small organizations that are willing to trial and fail, and you see that in non-profits and civil society spaces as well. They also champion social change. I would focus on that. We’ve seen it in Canada in the groups that have advocated against drinking and driving or for a range of issues. You see the same in other societies.
We work with partners — to get back to the LGBTQ question — that are really pushing the limits because they’ve found creative ways of engaging on a topic that is toxic in so many respects, yet find a way to create a space. We couldn’t come up with that from the outside. They know their space and how to engage. They’ve been able to get on the radio, talk to others, create spaces to bridge relationships and to build from there.
You’re right that it’s a sector that’s very innovative. It’s also a very cost-effective sector in the sense that with very little, you can achieve a lot. You have people who are so determined to work on a cause, whatever that cause is, if you’re talking about leading champions of change and associations. But it is a very big and diverse sector. I’m not sure where you want to go with the innovation, but there’s a lot of it there.
Senator Coyle: I just wanted to crack it open.
Mr. Achonu, you mentioned — actually, everybody mentioned climate change, but you also mentioned multilateral financial institutions and the modernization growth. Make them bigger, better and modern, is what you said. I’m curious, because when I was at COP 27 last year, there was a big focus on the change that’s required of these multilaterals, particularly to respond to climate change and to get on board the investments that are required there. Do you have anything that you want to add in that particular area, or Ms. Legault?
Ms. Legault: Yes, absolutely. With the reforms that are being discussed right now, what’s happening is that we have these big multilateral development banks, the most famous being the World Bank, but also regional ones like the African Development Bank. They have been around for a long time, and their whole purpose is to provide local financing, which is something that’s badly needed to fight climate change.
As Stanley was saying, if a country wants to invest in a solar plant right now, they’re going to have to pay much higher interest rates than if they want to build the same plant in Europe, so projects that could be financially viable are not because of the high interest rate. These banks, like the World Bank, do provide costs. The International Development Association, which is the low-income country arm of the World Bank, provide grants and almost zero-interest loans to countries. It’s a very good vehicle. However, they’re very slow. It takes a very long time to have a project from beginning to end, and they are very risk-averse. They are extremely safe banks. They almost have a four-A or five-A rating. It’s more than AAA, because they are extremely safe.
The Chair: I’m sorry to interrupt, but we have gone over time on that segment. That allows me to follow Senator Coyle’s train of thought and ask all three of you whether you think donor fatigue is a real problem. We know that to some degree it obviously reflects what elected governments want to do and what the population is telling them, but also — and I speak to my own experience in the international development sector — whether the Development Assistance Committee at the Organisation for Economic Co-operation and Development, or OECD, among the leading donor countries — not non-traditional donors like China, for example — whether there should be more consideration of different approaches and whether, in fact, there are areas where you can get a bigger gain for a smaller investment.
For example, Senator Ravalia and I have worked on neglected tropical diseases, or NTDs, and getting more funding for that, and that’s where, with just a small investment, you can get a greater result with the full eradication of some of these NTDs. That’s just an example.
I would be very interested in your thoughts about donor fatigue and whether the system that has worked so well for so long needs some significant retooling.
Mr. Achonu: Just quickly, I would say yes, it is a real thing that there is donor fatigue, and we have seen it. Just looking at ODA budget cuts from Germany, the U.K. and even here, we have seen a drastic reduction, a lot of it driven by internal politics. The extreme view of nationalism over multilateralism is driving that. That much is obvious — that there is a fatigue, but it’s not based on the reality of the challenges that the world currently faces.
Where we are in a world with multiplicity of crises all over the place, we should be giving more, not rolling back, because rolling back does not solve the problem. It only creates more crises in the long run.
I will let my colleagues chip in.
Mr. Moyer: Thank you for the question. I would say that there are some areas where you can have a bigger return in some respects, such as from a development impact perspective. Canada actually has some unique strengths in certain areas — I think of maternal, newborn and child health, where Canada has a unique niche in terms of its engagement in the world, and it has demonstrated great results and continues to do so.
I also think your question is a right one because we need to think differently from aid policy being how we engage with Africa, that it’s one vector, but it has to be looked at as a whole. This, to me, is the fundamental challenge before all decision makers looking at this from Canada today: What is the integrated perspective of Canada’s engagement in Africa? How does aid fit into that? Because looking at it alone, we’re going to continue down this aid fatigue path.
But looking at it comprehensively — and this is where I really struggle with the fact that we have to deal with this in what is a partisan, political world — there are winds of change that come with respect to these portfolios. This is something, I admit, that is a bit off the wall for me, but I do wonder if there is not a way for us to conceive of ways to get out of the cyclical priorities that are given. I look to some practices south of the border, where there is, for example, in the U.S. the African Growth and Opportunities Act that was passed. Is Africa an opportunity for Canada, in looking at this and the scale of the opportunity to engage with that continent, to think very differently than one strategy and the risk of that strategy being just aid or changing with the next government?
Looking at how these things come together is important because there is a cost-benefit ratio that can be looked at that is very different than just simply the aid portfolio.
The Chair: I hate to cut myself off in my own segment, but you have to practise what you preach.
[Translation]
Senator Gerba: You said earlier that interest rates are very high compared with the rates in African countries. The rates imposed on African countries are very high. You know that there’s a link between perceived risk and interest rates.
For over 25 years, I’ve been working to eliminate this negative perception.
Would it be possible to ensure that the perception of Africa is less negative and that banks and financial institutions can adjust, knowing that the relevant countries operate in this way, and take this into account when drawing up their financing?
[English]
Mr. Achonu: We have a paper on interest rates, and I think we can make that available to the committee, that looks at interest rates to low-income countries and how expensive it is — real data that we have looked at over the years. It would be an interesting item to look at for this committee.
But in response to your question, one of the main challenges — which is why we are advocating for reform of the global financial architecture — is that it has made it uneven. Some have it easy; others don’t, and when I share the report with you, you will see clearly, from country to country, how expensive it is.
I want to share — if the committee will indulge me — how much of a challenge this is. For Nigeria, where I come from, up to 80% of the revenue generated by government will go towards servicing loans, both the ones borrowed from capital markets, the Eurobonds and all of that. The challenge is that every change to interest rates in the U.S. drives up the cost of any borrowing you have made from the capital markets. This is how much it ties into the challenge that the African countries face.
When you are a low-income country and you go to the capital market to borrow to finance infrastructure, you are, even before you access the funding, at the risk of already overpaying in interest rates, sometimes up to 100 times the amount you have borrowed. It’s a real challenge.
This is why we are advocating for the multilateral institutions. They come very cheap, aside from the challenges that they face, which is the other part of the reform that we are driving. But they come very cheap. They are long-term versus the three-year or five-year sort of capital market borrowing that the African countries face. It completely prices African countries out of accessing financing.
We are saying, “Reform global financial architecture.” Canada happens to be one of those countries that have said yes, but Canada can be a leader in saying, “Let’s move quickly, and let’s do this now,” rather than continuing to talk through this through the G20. They have supported that process at the G20, but they need to show leadership and say, “The time is now, not tomorrow.”
The Chair: Thank you very much.
It is classic dilemma, colleagues. There is seven minutes left and four senators with questions.
Senator Woo: Ask the new senators if they have questions.
The Chair: Well, they are welcome to raise their hands if they have questions.
No? Okay.
In that case, I am going to ask all four senators to ask questions in succession. Please make them very, very succinct, and then our witnesses will be able to respond.
Senator MacDonald: Mr. Moyer, I think I’ll direct my question to you. You mentioned that you believe Canada needs Africa more than Africa needs Canada. I’m not questioning that, but I am just wondering if you could quantify that a bit and tell me in what area.
We’ve given a lot of money over the years in support of Africa. We should be. I want to see Africa developed. Yet, when there were votes in the UN on Canada on the Security Council, we didn’t get a lot of support from Africa. I just wanted you to reflect on that and where our benefit is.
The Chair: A good question, senator. Since I was involved in both of the recent campaigns that failed, I would be interested in that too.
Senator Woo: My question is about donor coordination. There was a discussion about how Canada should put more into infrastructure because China puts so much in. There is a reason why China puts so much in infrastructure: They are terrible at the soft programming side, and they are very good at infrastructure.
This may be unrealistic, but what is the state of donor coordination in some or all African countries? That is the solution, surely. We shouldn’t be asking countries that can’t do infrastructure to do infrastructure just because they want their names on a bridge.
Senator Coyle: We’re studying Canada’s interests and engagements in Africa. Both organizations represented here have talked about the absolute critical importance of partnerships, and you have talked a little about the partnerships in Africa, but we haven’t heard much about partnerships with whom on the Canadian side, the broader landscape. Obviously, there are your organizations, but the broader landscape in Canada. We always think of Global Affairs, but beyond Global Affairs, who else would you see being critical to those important equity partnerships as have been described?
Senator M. Deacon: I will try to shorten this up. A topic came up earlier about the pandemic and where Africa was truly on the sidelines. The African Union and the Africa CDC proposed an ambitious target moving forward to manufacture 60% of Africa’s routine and outbreak immunization needs by 2040. What is the role, if there is a role, for Canada in that? Thank you.
The Chair: Three minutes. I don’t know how you want to divide the time. I also wanted to say that if you want to send us something in writing, because these have very important questions being asked at the end, please feel free to do so. Over to you, however you want to respond.
Mr. Moyer: These are all great questions. There is a clear role for donor coordination in all this. We can’t unpack it.
I would say among some core donors, there is decent coordination, but does it follow back into overall strategic coordination? I think there is room for improvement there.
Africa does not need Canada. That’s the point I’m trying to make. If we want to engage on that continent, we need to go in aware of that. This is not about us parachuting in. It’s about figuring out what that relationship is. Our decision making should have embedded in it African interests. If we don’t, then we’re going to continue to face cases where we don’t have them stepping up to support us when we need them to.
There are a lot of cases to unpack with respect to the economic potential over time and building those relationships, as we did with Korea after the war, and now trade with that country eclipses completely the aid we gave to that country decades ago.
Those are a few thoughts from me.
Ms. Legault: On Canada needing Africa, there is just one statistic. I will have to find the correct number, but I read that 98% of the labour force growth of the world in the next few decades is going to come from Africa. It’s just gigantic. The whole world will need Africa because that is where the labour force will be.
On the pandemic and vaccine manufacturing, absolutely, there are things that Canada can support. We were talking about Gavi. They have a new program now. It’s called Advance Market Commitment, and countries such as Canada can support these African manufacturing initiatives. We really should.
Mr. Achonu: As to whom here Canada should be looking to, I think that bringing trade, development, diplomacy, education and security together will be a force to put together in terms of how you relate to Africa. It’s not just Foreign Affairs. It’s also all of the associated trade and all the other agencies of the Canadian government pulling together to make a strong commitment to Africa.
The Chair: Thank you very much. I know that we had another senator who wanted to ask a question.
Senator Al Zaibak, if you want to come back tomorrow at 11:30, you’ll probably have an opportunity to ask a question in tomorrow’s meeting.
I would like, on behalf of the committee, to thank our three witnesses — Nicolas Moyer, Elise Legault and Stanley Achonu — for being with us today. This has been a very good discussion. You have enriched and enlightened this committee. Thank you again; be well.
(The committee adjourned.)