Thank you.
Results Canada is a citizens' advocacy group with chapters across the country. We work to generate the political will to end hunger and the worst aspects of global poverty.
We are a member of both the Canadian Council for International Co-operation and the Make Poverty History campaign, which my colleague Michael just mentioned and which has the support of almost a quarter of a million Canadians pressing the government to take more action against global poverty.
Canada's foreign aid is currently about 0.3% of gross national income, far below the 0.7% that is needed to reach the millennium development goals. These goals are intended to cut extreme poverty by 50% by the year 2015.
As Michael mentioned, during the election Prime Minister Harper promised to bring Canada's aid up to at least the average of other donor countries. However, this will require increases beyond those currently planned, so it seems that Canada, despite a long string of budget surpluses, will not reach even the average level of generosity promised by Mr. Harper. Clearly, we must do more.
In addition to more aid, of course, we must provide better aid. We also welcome the initiative of Mr. McKay with Bill C-293, the Development Assistance Accountability Act, which will bring Canada closer to better and more poverty-focused international aid.
In addition, we believe Canada should focus aid on those actions that have the greatest impact. I'd like to focus on two today: disease and microcredit.
Together, the three diseases malaria, tuberculosis, and AIDS kill six million people a year. This is a holocaust of preventable death each year. Malaria and tuberculosis in particular need additional funding from both CIDA and the World Bank. Canada has made important contributions to the global fund to fight AIDS, TB, and malaria, but more is needed to reach our fair share. More details and numbers are in the brief.
For the rest of my time, I'd just like to speak about microfinance, a topic that I hope will be of special interest to this committee.
As we sit here today, over 1.2 billion people struggle to survive on less than one U.S. dollar per day, a massive tragedy of human suffering and lost potential. Microcredit is probably the single most important solution to this problem. Microcredit provides the very poor with a no-collateral loan from as little as $3 to no more than a few hundred dollars to start or expand small self-employment businesses, such as selling clothes, making food to sell, operating bicycle rickshaws, or renting out cell phones. Repayment rates are typically over 98%.
In the harsh conditions of the informal economy that employs millions around the world, microcredit has proven to be a powerful tool to help people lift themselves out of poverty and improve their nutrition, their housing, and their education. Experiences from countries as diverse as Bangladesh and Bolivia show that extreme poverty among microcredit borrowers can be reduced by 70% within five years of entering a loan program.
In contrast to charity, which becomes more expensive with every person helped, microfinance becomes self-sustaining once it reaches a large scale. This is one of the unique strengths of microcredit as a force for ending extreme poverty. However, start-up funding is required.
Both CIDA and the World Bank give far too little to microcredit, well under 1% of their respective budgets. In CIDA's case, microcredit spending has actually declined 25% over the past five years, to about $30 million per year.
To raise the profile of microcredit, our group has organized the Global Microcredit Summit, to be held next month in Halifax, from November 12 to 15. The microcredit summit campaign was originally launched in 1997, and so far it has resulted in a tenfold increase in the number of poor people with access to microcredit around the world, from seven million people in 1996 to over 92 million people by 2005. Over 2,000 microfinance practitioners and borrowers from over 100 countries will attend the Global Microcredit Summit next month, which will be convened to share best practices and set a new goal for 2015, the target date for the millennium development goals.
I'd like to extend an invitation to the members of this committee to join me in Halifax to learn more. Microcredit is short-term aid that becomes self-sustaining after a start-up period of donor support. As such, it's one of the best examples of effective aid and must receive much more attention from Canada's aid program.
Thank you.