International Co-operation Minister Julian Fantino is not helping his government and is undermining needed reforms to foreign-aid delivery by his incoherent rhetoric and weak grasp of his file. He has profoundly miscommunicated the ideas behind the creation of public-private partnerships to deliver aid, and responded defensively to questions. "We're not talking about pillaging and exporting," he said this week.
Mr. Fantino is consequently diverting attention from the clear benefits that the approach could have, including better ways of poverty reduction, and promotion of sustainable development overseas. Partnering with the private sector, including enterprises, foundations and individuals, is a good idea, and can improve the flexibility, transparency and effectiveness of aid projects.
While it might be seen as revolutionary by some circles in Ottawa, the public-private model was endorsed by the U.S. a decade ago, and has been followed by Australia, Germany and the U.K., with minimal controversy. In fact, many Canadian companies already partner with USAID. The results have been largely positive.
The parliamentary standing committee on foreign affairs and international development held hearings for several months on the issue and recently released a 118-page report with recommendations supporting this approach to aid delivery (with some notable opposition dissenters). "The key is the realization that the private sector has the resources, expertise and money to invest in these development projects. They want to do it for many reasons. It is expected of them, and they need things done that the state cannot do in many countries," said Carlo Dade, a senior fellow at the University of Ottawa and development expert who testified before the committee.
Much of the criticism in Canada has centred on three pilot partnerships CIDA launched in 2011 with mining companies and non-governmental organizations. Opponents are concerned CIDA is "subsidizing" the mining sector's corporate social responsibility obligation. It is a legitimate worry, but the fear has not been borne out. In fact, it can be seen to be doing the precise opposite, leveraging private-sector support for needed human investments.
Nor should CIDA work only with extracting industries, but rather with small and medium-sized local businesses that will be sustainable – unlike extraction. Ideally, the agency will canvas companies, foundations and civil society organizations in many sectors to see if there are projects that meet Canada's development goals. These projects could range from watershed management and microfinance to mobile phone capacity. The private sector is the leading source of innovation, technology and human capital, especially in an era of government cutbacks. Complacency is not the answer. Now if only someone in the government could get the message out.