Foreign Affairs Committee on Dec. 1st, 2020

[Idee Inyangudor]

If I understand your question correctly, you are asking if Canadian aid is focused on where it gets the most results and impact. From a policy perspective, I think, yes, there's pretty much very little difference between successive Canadian governments in terms of how international development is done. That's mostly because there's a lot of international agreement and global agreements by experts, by practitioners and by people in the private sector on aid and the best use of aid.

I think the major issue isn't whether the aid is getting results. It is. The question is whether the results can be scaled up even more. What vehicles do you have to do that? I would argue that the landscape of development finance is changing quickly. Canada's foreign policy and Canada's international development assistance programs don't have the complete set of tools to pay for the kinds of markets we are targeting. The results are there, but there is a lot more. With the right vehicles, you could definitely scale these results four or five times, especially when it comes to the issue of making blended finance available for markets like Africa or this place where I am right now.

[Marty Morantz, Conservative, Charleswood—St. James—Assiniboia—Headingley, MB]

Could you elaborate on the issue of blended finance? In the area of development finance, what importance is played by development finance institutes in attracting, for example, more private sector capital to deal with these issues?

[Idee Inyangudor]

Blended finance is an emerging area of doing finance. I would argue it is more enduring for the next level of folks when they graduate out of that poverty strata at the bottom of the pyramid level. It's a tool that allows them to stay above that and also to leverage a lot of private sector capital by de-risking various projects and deals, making liquid cash or investment capital available to them.

[Marty Morantz, Conservative, Charleswood—St. James—Assiniboia—Headingley, MB]

Thank you.

Dr. Dagher, you mentioned Lebanon. There was, of course, the tragic event of the port explosions. You wrote in a blog post about this, I think on September 15, that Canada’s aid contribution for this incident was “too little, too slow and misplaced".

I'm wondering if you could elaborate on that comment and what you meant by it.

[Dr. Ruby Dagher]

Sure, thank you.

Full disclosure, I am Lebanese. I have dual citizenship. I am Lebanese and Canadian. I came here after the civil war ended.

I believed...when the explosion happened and we saw the results, all my contacts in Lebanon—because I do have contacts who work in local organizations—realized that there was a commitment that was made, but the actual transfer of the money took very long to get to Lebanon and to get to the institutions that were helping people. That was number one. That's why I said it was too late, because it took very long for it to get there.

Number two, along the way there were chunks that were removed for administrative costs between international organizations and local organizations, meaning that not all of it got to Lebanon.

Number three, we did not work with local organizations as much as we should have.

Having worked at CIDA, I do know that PCO does a really good job in trying to understand the local actors on the ground and who is there and who is not there. I know that our embassy in Lebanon—because I also worked on the Lebanon program—also has a very good handle regarding what local organizations exist and which ones don't exist and who is aligned and who is not aligned politically.

We had the capacity and we had the knowledge to work with local organizations, but unfortunately, we ended up working with large ones and diverting some of the money into the administrative financing of these initiatives rather than truly helping people.

[The Chair, Liberal, Sven Spengemann]

Mr. Morantz and Dr. Dagher, could I stop you just momentarily?

There has been a helpful suggestion by a colleague that we extend each of these rounds in the first panel by about a minute and a half. That would take up the entire time rather than having a second round of maybe a minute per member.

That would now give you an extra minute and 30 seconds, Mr. Morantz, that you are free to take advantage of, or you could share with a colleague within your party.

If that's okay with the committee, I'll let the clock run. That way everybody in this first round gets an additional minute and 30 seconds.

Go ahead, sir.

[Marty Morantz, Conservative, Charleswood—St. James—Assiniboia—Headingley, MB]

Thank you, Chair.

You have commented on this whole issue of the utilization of local agencies in a way that's independent of political or state influence. I wonder if you could comment on what you mean by that.

Also, in the time we have left, what type of mechanisms could we bring to bear that could make sure our aid is being used as efficiently as possible and getting to the people who it needs to get to as quickly as possible?

[Dr. Ruby Dagher]

My comment is not only based on Lebanon but on my experience doing research in conflict-affected states and fragile states. I can attest to the fact that a lot of the leaders involved in the conflict or not involved in the conflict, in the government or outside the government tend to use local civil society organizations to improve their legitimacy and to improve their power. A lot of these organizations are connected to these people, but there are also many that are not connected.

The problem we have is that if we were to work with organizations that were connected with these people, we would then contribute to this whole fight of power and legitimacy, and we would end up undermining either democratic development or good governance, whatever initiatives we or our partners are doing with our programs there. However, again, there are local organizations that are not affiliated with any of these, and we can definitely work with them.

As for your question as to what we can do, I refer to what I said earlier. Canada has the mechanisms to figure out who is on the ground and who is not on the ground.

When I was working for the government, we used to use our partners to also figure out who is affiliated and who is not affiliated. It's not that we don't have the capacity; it's just I'm not sure that we have the willingness to take the risk to start doing it that way.

I think what ends up happening is we end up being too comfortable with large organizations and just fall back on them for security purposes and not—

[The Chair, Liberal, Sven Spengemann]

Ms. Dagher, we'll have to leave it there, unfortunately.

Thank you, Mr. Morantz and Professor Dagher.

The next round goes to Ms. Dabrusin for up to eight minutes, please.

[Julie Dabrusin, Liberal, Toronto—Danforth, ON]

I will be sharing the last two minutes of my time with Ms. Sahota.

I want to begin with you, Mr. Inyangudor, if I may, because I am particularly interested in issues of food security. You mentioned that, first of all, the UN nutrition targets for this year will not be met and that they're slowing. You referred to supply chains as well and the challenges that COVID created for supply chains.

What have we learned through this COVID pandemic that we could use to strengthen food supply chains to areas that are more vulnerable?

[Idee Inyangudor]

I'll say that first we need to increase access to finance. For local producers, there's a big disconnect between the local producers and the resources they have to get their goods to market. Like I said, I'm in Nigeria today and I go to Azerbaijan tomorrow, and in both countries, it's not food shortages. It's a lack of mechanisms to get the food to where it's needed the most or to get it distributed across the country.

I think that making financing available concessionally, with acquisitional rates or market rates that are a little more affordable for this market, would be one way to do so, but just getting food to market is not going to be enough. There is an issue as well of the operating environment. I think the other witness, my colleague, mentioned this as well.

You need to strengthen this market for the rule of law and to strengthen democracy, justice and human rights. All of that needs to be strengthened. Working together, these things make a difference in these markets. I would say that one is access to financing and the other is strengthening democratic governance.

[Julie Dabrusin, Liberal, Toronto—Danforth, ON]

I'm hoping that I have a couple of seconds for Professor Dagher, too, but following up on that, one of the things I've been most interested in when listening to witnesses is, how do we have money lent to decentralize? I think that was the word used by a previous witness in our last panel as well. If we're looking at trying to decentralize aid in a way to support civil society as well, how do we do that to support food security? It's a concept. How do we make it land?

[Idee Inyangudor]

Is that for me or for Professor Dagher?

[Julie Dabrusin, Liberal, Toronto—Danforth, ON]

I will go with you and then I'm going to ask Professor Dagher to jump in.

[Idee Inyangudor]

Right now, a lot or a big majority, say, maybe close to 60% or 70%, of DFI banks don't have the kinds of capitalization and liquidity they need to support their markets. It's good to develop financial solutions, but there should definitely be a mandate or some kind of policy whereby those DFIs are working directly with the local financial institutions to get capital into them so that they can then lend or make that financing available to their own communities and markets. That's how you can do it.

[Julie Dabrusin, Liberal, Toronto—Danforth, ON]

Professor Dagher, could I ask you to jump in on this? It touches right to the heart of what you're talking about, which is, how do we make sure that it lands appropriately? I don't know if you have any comments on what Mr. Inyangudor said or anything to add to that.

[Dr. Ruby Dagher]

For me, here's what is really important. Again, having worked with the government in what used to be CIDA at that time, I know, for example, that we had locally engaged staff. I know that we tried to draw on local expertise. I also know that we gathered quite a bit of information.

Again, I think that whole idea of decentralization is being willing to give these locally engaged staff a bit more voice and more power and having them be able to give us more information. Part of what I've been trying to say all along is that we need to try to understand what they want. We need to try to understand their point of view. We need to try to understand their issues and then work backwards from there and figure out what we can do to help, rather than going in with a preconceived notion of what supports it and what doesn't.

Mr. Inyangudor was talking about access to markets and prices. I think a lot of it has to do with really and truly understanding the situation. I think that if we were able to do that and comprehend the systems and structures, the risk of decentralization would not be that high.

[Julie Dabrusin, Liberal, Toronto—Danforth, ON]

I have a very quick question to follow up on that.

When we look at the most vulnerable within the vulnerable, for example, I'm thinking about LGBTQ2 communities around the world, when we devolve to decentralize, how do we make sure that we're also protecting them in that process?

[Dr. Ruby Dagher]

I think the biggest thing we should do when we devolve and decentralize is that we need to also have an objective to hear from a wide variety of people and organizations.

Devolving and decentralizing does not mean saying “here you go” and being blind to it and moving along. It means making sure that we are doing the participatory approaches that we need to do and that we are talking to a wide gamut of people and trying to understand their situation. If we do this correctly and we give our locally engaged staff the directive to go and speak to various people and to identify the vulnerable populations, I don't think there's much of a risk of us completely ignoring them.

[Julie Dabrusin, Liberal, Toronto—Danforth, ON]

I'll pass it to Ms. Sahota now.

[Ruby Sahota, Liberal, Brampton North, ON]

How much time do I have, Chair?

[The Chair, Liberal, Sven Spengemann]

You have a good minute, Ms. Sahota.

[Ruby Sahota, Liberal, Brampton North, ON]

Maybe I'll just build on that. This is for Ms. Dagher.

About the organizations, I can completely understand why going directly to local organizations would be beneficial. You spoke about wanting to make sure that these organizations are independent of government, political leadership, opposition and militias. How can that really be ensured? It's so difficult. I think that is why oftentimes governments that are removed fall back on these larger organizations. We hear of accusations that money ends up in hands or into organizations that may have involvements with some of these groups.

Do groups exist that have no attachment to any of these actors?

[The Chair, Liberal, Sven Spengemann]

Give a brief answer, please.

[Dr. Ruby Dagher]

In any conflict country, you cannot have zero contact. It's impossible because you need to be able to manoeuvre the terrain. Yes, we do have organizations that are independent. I know for a fact. I helped develop a list of these organizations. Canada knows for a fact that we have these organizations. It will take a rethinking and it would take us using different resources, but I think we can get there. I don't think it's impossible.