Canada's foreign aid minister says he wants to correct a "myth" that the federal government is propping up mining companies by financing development projects in communities where they work.
In a recent interview with The Globe and Mail, International Development Minister Christian Paradis pushed back against suggestions that a series of pilot projects with Canadian mining companies and non-governmental organizations provide a disproportionate benefit to the companies involved. He spoke with the Globe last week, shortly before departing for South Africa to attend an international mining conference.
"What we're trying to do here is to have leverage with the extractive sector to invest in development projects," Mr. Paradis said. "The idea is not to finance the private sector or the extractive sector, the idea is to put money in investments that will have tangible results in terms of development."
The pilot projects were launched in 2011 and are co-financed by the government, mining companies and non-governmental organizations, with the federal government providing between 50 and 75 per cent of the funding. A project in Ghana aims to improve access to education and clean water, while another, in Burkina Faso, is focused on providing job training opportunities.
Critics of the initiative say it uses money designed to reduce global poverty to provide an indirect subsidy for mining companies' corporate social responsibility programs, an idea Mr. Paradis rejects.
"This is a myth here that we seriously have to correct," he said. "We will [provide] money in terms of leveraging for development, but not [for] investing in the private sector."
Mr. Paradis said it was too soon to comment on whether the pilot projects will be replicated in other countries where Canada provides development assistance.
The mining projects are part of a growing effort to align Canada's development work with its trading and investment interests abroad. A report obtained by The Globe and Mail shows the now-defunct Canadian International Development Agency analyzed dozens of low-income countries to determine what Canada could expect to gain by continuing to provide them with foreign aid. (CIDA was eliminated last year and its work is now part of an expanded Department of Foreign Affairs, Trade and Development.) Many of the countries listed in the CIDA report were identified as having mineral resources that are of interest to Canadian firms, including Mongolia, Peru, Bolivia and Ghana. In one case, CIDA recommended that Canada "scale up" its development programming in Mongolia, a middle-income country with significant mineral resource wealth, noting that a well-managed resource sector would "level the playing field" and improve predictability for investors.
"I think that there [are] a lot of things that can be done [in Mongolia] and of course we have some expertise, as you know," Mr. Paradis said. "Mongolia is very rich in terms of resources, and this is somewhere we could make a difference to help them. There's a lot of need in terms of sharing best-practices."
He said the government is also considering whether to provide more aid to Myanmar, which is currently undergoing a series of democratic reforms. Some aid experts have speculated that Canada could launch a bigger development program in the Southeast Asian country, which is listed as a priority market under the government's new Global Markets Action Plan.
"Saying now that this is a country of focus or not, I'm not there," he said. But he added, "We are evaluating this and if there is something new at some point we will announce it in due course."
Kim Mackrael is a parliamentary reporter in Ottawa.