Eye on the prize
Canada’s G7 goal on development: luring private capital to poor nations
When G7 finance and international development ministers convene in British Columbia next week, Canada hopes the meetings will generate fresh ideas on how aid money can be leveraged to entice the private sector to boost investments in poorer parts of the world.
The challenging search for solutions will take place in Whistler, where finance and international development ministers will gather together for the first time at formal G7 meetings.
Many countries, including G7 members like the United States and the United Kingdom, have been working for some time to lure more private capital into developing nations as a way to help make up for inadequate levels of foreign aid.
Canada has been a late bloomer in this area. Earlier this year, it became the last G7 country to create a development finance institution to operate alongside its government-run foreign aid program.
Marie-Claude Bibeau, the federal international development minister, says the hunt for new ways to get more private investment cash into developing countries will be a key part of the talks in Whistler.
As this year’s G7 host, Bibeau says Canada will also put female empowerment at the centre of the development discussions — with new approaches that will take into consideration the full life cycle of girls, adolescents and women.
Whatever Canada announces on development, she added, will be in line with the Trudeau government’s feminist policy.
But Bibeau stressed that without innovative ideas, the international community will fall well short of its overall targets on eradicating poverty.
Investments from donor countries around the world will have to be between $5 and $7 trillion in order to achieve the planet’s sustainable development goals by 2030, she said.
Total funding last year was around $147 billion, she added.
“We have to go from billions to trillions, so we know that if we only count on those donor countries, such as Canada and the G7 countries, we will never end poverty,” Bibeau told The Canadian Press in an interview.
“So, we really have to think differently and bring new partners on board.”
Bibeau said many options will be on the table in Whistler. She declined to get into specifics, but added that solutions could involve new ways of removing financial hazards for the private sector in riskier parts of the world.
Canada sees the G7 as an important setting to come up with new ideas because of the large role it plays in development.
Bibeau’s office says the G7, including the EU, provides 76 per cent of the world’s “official development assistance,” which is defined as government aid intended to improve economic and social development in poor countries. The G7 also provides 81 per cent of the planet’s humanitarian assistance, a spokeswoman for Bibeau said.
The G7 discussions will also focus on trying to get the private sector interested in investing in women’s businesses in developing countries — and Bibeau said there will be an emphasis on adolescent girls.