The federal government is providing added funding aimed at boosting transparency in the extractive sector, a sign Ottawa’s foreign aid efforts are becoming increasingly focused on the mining industry.
International Development Minister Christian Paradis said Saturday that he believes mining companies can play a role in reducing poverty and turning development recipients into trading partners. The Conservative government has pushed for more links between the mining industry and international development efforts by establishing a mining policy institute and launching a series of pilot development projects involving Canadian mining companies.
"We know that a responsibly managed extractive sector has the potential to transform countries," Mr. Paradis said. "It has the potential to lift millions of people out of poverty."
Speaking at a day-long conference on mining and development, Mr. Paradis said Canada would provide $10-million to an Inter-American Development Bank transparency trust and another $10-million over the next five years to the African Legal Support Facility, which helps African governments negotiate and review mining contracts.
He also announced funding for mining sector transparency efforts in Indonesia and for the International Institute for Sustainable Development, which works with countries on their mining policies.
The conference was held one day ahead of the official launch of the Prospector and Developers Association annual convention, where thousands in the mining industry will gather to make deals and discuss investment opportunities.
"Natural resources are an opportunity to be seized," Mr. Paradis said. He said exports of oil and minerals translate into more jobs that improve peoples' livelihoods, and that Canada has a role to play as a facilitator between the public sector, non-governmental organizations and the private sector.
The federal government has been criticized by a number of non-governmental organizations and aid experts for a group of pilot projects providing development assistance to communities where Canadian mining companies were working. The projects were co-funded by mining companies, NGOs and the Canadian International Development Agency and implemented by the NGOs.
The projects were touted as a way to leverage mining companies’ resources to improve Canada’s development efforts, but critics argued they acted as an indirect subsidy for the companies by helping to finance projects that improved those companies' reputations.
Mr. Paradis did not comment directly on the pilot projects during his Saturday speech. He said he views sustainable povery reduction and sustainable private sector growth as directly linked, adding, “It is nearly impossible to have one without the other.”
"Creating sustainable economic growth is our most effective tool in eradicating poverty around the world. We need to leverage private sector involvement to generate jobs, growth and prosperity in developing countries," he told the conference.
The Canadian International Development Agency, long the federal government’s main instrument for disbursing foreign aid, was dissolved last year and its functions were folded into the Department of Foreign Affairs and Trade.
The change has left many wondering what how the change will affect the federal government's approach to foreign aid. Government officials have said in the past that they would maintain CIDA’s core focus on poverty reduction under the new department.