Canada’s insufficient military spending has garnered widespread attention this year. The country’s longstanding shortfall in foreign aid has generated less concern.
The grinding war in Ukraine and potential threat of China have rallied widespread support, including from this space, to reach the NATO spending target of 2 per cent of GDP. In 2022, Canada’s defence spending was 1.29 per cent of GDP.
But there’s a similar, yet lesser known, international yardstick on which Canada also falls well below the collective goal: spending 0.7 per cent of gross national income (another measure of a country’s economy) on official development assistance. The target was agreed on in 1970, following a United Nations commission led by Lester Pearson. The closest Canada came to the mark was in 1978, at 0.54 per cent of GNI. For the past three decades, Canada’s contribution has languished around or below 0.3 per cent of GNI.
In the latest global tally, issued by the OECD in April, Canada looked better, but the gains may be fleeting. For 2022, Canada’s official development assistance spending was 0.37 per cent of GNI, the highest level since 1995.
The increase was driven by support for Ukraine. Canada’s higher spending came as foreign aid rose to record levels in 2022, yet the average among several dozen wealthy donor countries was just 0.36 per cent of GNI. Only five countries – Luxembourg, Sweden, Norway, Germany and Denmark – hit or exceeded 0.7 per cent.
The federal Liberals have promised annual increases to foreign aid through 2030, to support the UN’s sustainable development goals, but last year may turn out to be a high-water mark. And that’s bad news. Increased military spending is important in a world of greater geopolitical uncertainty, but the soft power that comes from a generous and wisely invested foreign aid program is a key complement to the ability to deploy Canadian forces.
This year’s federal budget had $6.9-billion for foreign aid. That’s down from more than $8-billion, but the Liberals said it remains higher than the $6.6-billion in 2019, before the pandemic. Aid groups wanted spending to jump to $10-billion by 2025 – which would be about 0.45 per cent of GNI.
Instead, Canada is seemingly in retreat from, rather than advancing towards, the 0.7 per cent target. This fits the country’s reality over recent decades, whether Conservatives or Liberals are in power. From 1970 through 1995, it was better. Canada spent an average of 0.46 per cent of GNI on foreign aid annually. This helped Canada maintain a strong international reputation. But with flagging aid and weak military spending, that reputation has faded over the years.
Decline in aid started in the 1990s, after Brian Mulroney had made it a priority. The nadir came in 2004 when aid was 0.23 per cent of GNI under Paul Martin. The low under Stephen Harper was 0.26 per cent of GNI in 2014, the year after Mr. Harper shuttered the Canadian International Development Agency and moved its work into what is now Global Affairs Canada.
Justin Trudeau, beyond his “Canada is back” marketing in 2015, hasn’t transformed aid. In 2016, he said the 0.7 per cent target was “too ambitious” in the short term.
In 2018, the OECD said Canada wasn’t doing enough on foreign aid, after spending hadn’t moved higher compared with Mr. Harper. In 2019, when aid was at 0.27 per cent of GNI, the Conservatives proposed to gut it by cutting a quarter of the funding. The same year Mr. Mulroney, criticizing Conservatives and Liberals, called Canada’s foreign aid “anemic and embarrassing.”
The improvement in the past several years was good news but, after a flush of foreign aid during the pandemic and then support to Ukraine, it looks like Canada’s rate of development assistance could fall back below 0.3 per cent of GNI.
Few countries have ever reached the 0.7 per cent goal. Britain is one of them, and it did so with concerted focus. It first reached the target in 2013; in 2015 it legislated the goal. Britain’s aid spending was at the 0.7 per cent target as recently as 2020 but fell to about 0.5 per cent the past two years.
The Liberals’ pledge of increased foreign aid in every year of this decade has already faltered, and we’re not even halfway to 2030. Ottawa needs to further bolster spending on foreign aid. Canada’s presence in the world, whether military, economic development or humanitarian, needs to be backed up with adequate funding.