FAIT Committee Meeting

37th PARLIAMENT, 2nd SESSION

Standing Committee on Foreign Affairs and International Trade

EVIDENCE

CONTENTS

Thursday, June 5, 2003

¿

0920

The Chair (Mr. Bernard Patry (Pierrefonds—Dollard, Lib.))

Ms. Eveline Herfkens (Executive Coordinator, Millennium Campaign, United Nations Development Programme)

¿

0925

¿

0930

The Chair

Mr. Deepak Obhrai (Calgary East, Canadian Alliance)

¿

0935

Ms. Eveline Herfkens

The Chair

¿

0940

Ms. Francine Lalonde (Mercier, BQ)

Ms. Eveline Herfkens

Ms. Francine Lalonde

The Chair

Ms. Eveline Herfkens

¿

0945

The Chair

Mrs. Karen Redman (Kitchener Centre, Lib.)

¿

0950

Ms. Eveline Herfkens

¿

0955

The Chair

Mr. Keith Martin (Esquimalt—Juan de Fuca, Canadian Alliance)

À

1000

Ms. Eveline Herfkens

Mr. Keith Martin

Ms. Eveline Herfkens

Mr. Keith Martin

Ms. Eveline Herfkens

À

1005

The Chair

Ms. Eveline Herfkens

The Chair

Mr. Mark Eyking (Sydney—Victoria, Lib.)

Ms. Eveline Herfkens

À

1010

The Chair

Mr. André Harvey (Chicoutimi—Le Fjord, Lib.)

À

1015

The Chair

Ms. Eveline Herfkens

The Chair

Mrs. Karen Kraft Sloan (York North)

À

1020

Ms. Eveline Herfkens

Mrs. Karen Kraft Sloan

The Chair

Mrs. Karen Kraft Sloan

Ms. Eveline Herfkens

Mrs. Karen Kraft Sloan

Ms. Eveline Herfkens

Mrs. Karen Kraft Sloan

Ms. Eveline Herfkens

Mrs. Karen Kraft Sloan

Ms. Eveline Herfkens

Mrs. Karen Kraft Sloan

The Chair

Ms. Eveline Herfkens

Mrs. Karen Kraft Sloan

Ms. Eveline Herfkens

À

1025

The Chair

Mr. Deepak Obhrai

Ms. Eveline Herfkens

The Chair

Ms. Eveline Herfkens

The Chair

Ms. Eveline Herfkens

The Chair

Ms. Eveline Herfkens

À

1030

The Chair

Mr. John Harvard (Charleswood—St. James—Assiniboia, Lib.)

The Chair

Mr. John Harvard

The Chair

Ms. Eveline Herfkens

À

1035

The Chair

Mr. Keith Martin

Ms. Eveline Herfkens

Ms. Francine Lalonde

Ms. Eveline Herfkens

À

1040

The Chair

Ms. Eveline Herfkens

The Chair

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CANADA

Standing Committee on Foreign Affairs and International Trade

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NUMBER 039

l

2nd SESSION

l

37th PARLIAMENT

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EVIDENCE

Thursday, June 5, 2003

[Recorded by Electronic Apparatus]

¿  (0920)  

[English]

    The Chair (Mr. Bernard Patry (Pierrefonds—Dollard, Lib.)): Pursuant to Standing Order 108(2), the committee is considering the millennium development goals and the role of the United Nations Development Programme.

    We have the pleasure to have with us this morning Mrs. Eveline Herfkens, executive coordinator for the Millennium Campaign. All the members have received her biography. Mrs. Herfkens was the minister for international cooperation for the Netherlands from 1998 until 2002, and before that, from 1996 to 1997 she was ambassador to the United Nations and the WTO. It means that she knows the political side and the United Nations side. It's going to be really good for us.

    I understand you have some introductory remarks and after that we'll have questions and answers. The floor is yours, Mrs. Herfkens. Welcome.

    Ms. Eveline Herfkens (Executive Coordinator, Millennium Campaign, United Nations Development Programme): Thank you very much. It's a great pleasure for me to be here. If you had gone through my bio, you'd have seen that further down it says that I actually was a member of Parliament in the Netherlands between 1981 and 1990. I also was a very active member at the time in Parliamentarians for Global Action, and those who are members know that half of its membership is Canadian. So I really feel I am among friends being here.

    I want to tell you a little bit about the millennium development goals. In case you didn't know these goals,I thought it would be useful to distribute them to you on a little paper.

    Let me tell you that what I think it is important to realize is how great these goals actually are. Let me give you five points. First, I've been in development cooperation most of my life, and we wasted decades at the United Nations and elsewhere talking, talking, talking, and disagreeing, disagreeing. We spent decades disagreeing between east and west, but even more, we continued to disagree between north and south about development, what should it be and who is responsible.

    The great thing about the millennium development goals is that actually this is a package that everybody has signed on to; 189 heads of states, heads of governments, signed on to them.

    The second disagreement was always the UN versus the international financial institutions. This package came from the UN, but the international financial institutions have warmly endorsed them.

    The third difference was always between what governments do and non-governmental actors. This package came from a governmental platform, but NGOs have really embraced them.

    The next thing that I think is great about these goals is that those in the development business have for too long spent too much time in ivory towers talking in abbreviations that the electorate and people never understood. With the goals, we've put development issues back on the agenda, where you can explain to a cab driver what this is about. This is about dealing with poverty, with maternal health, with child mortality, with sustainable development and good environmental development, and about getting kids to school, things that people and the electorate do care about.

    The next thing that is great about the goals is that they're holistic and integrated. If you succeed in getting more girls to school, which is goal two, you will empower women, which is goal three, and you will assure a better health of her family later, which is two other goals. So there's a lot of synergy. If you achieve the targets on sanitation, it will allow girls to go to school, because too many girls spend too much time getting water for the family. So there's a lot of synergy among these goals, and if you move on one, bingo, you get more on the other.

    The fourth point about the goals is that they're simple, they're concrete, they're measurable, and they're time bound. What we are now doing at the UN is helping developing countries to actually measure where they are and making reports to their own people. For example, Mozambique has a target of halving the number of poor by the year 2015. Where are we with the number of girls we get through school? These concrete, time-bound data make it possible for parliaments and civil society to make governments accountable for their pledge.

    It also enables us to bring together these figures to see how we are globally and compare how countries are doing in comparison to others. That is a very powerful way to spur political action. Nobody wants to perform less than their neighbours.

    I recall when the Netherlands fell six places in the human development index in the 1990s because the gender component was included. It really spurred political action and debate it never had before. We don't want to be worse than the Belgians, and the French don't want to be below the Italians, and you recognize this. Whenever Transparency International or Freedom House comes out with an index, you always look to see where your country is. You can't stand it if your country is performing worse than comparable countries or your neighbours. So that is a very strong means to get action.

    The fifth and last point why these goals are great is that we've been spending decades when the north was blaming the south for not dealing effectively with poverty, while poor countries were blaming rich countries for not giving them enough aid, etc. While those were not very fruitful debates, the goals now have the deal, which is a deal on which we all agreed at the Finance for Development Conference in Monterrey, that the responsibility to deal with poverty is basically with poor countries. They have the primary responsibility, but for poor countries, unless rich countries do a better job on aid, debt relief, and trade opportunities, they will not be able to achieve their goals.

    Goal eight is part of the package, and more aid, better aid, better trade, etc., is part of the deal that has put an end to the debate on who is to blame.

    I would like to talk a little bit about goal eight. As it is the primary responsibility for developing countries to deal with poverty and getting kids to school, whenever I speak to parliaments there, I elaborate on their responsibility. So allow me now to particularly focus a little bit on the responsibility of rich countries.

    You would wonder why you would like to care about people who are not among your own electorates. That is, of course, for a politician a good question to ask first. But one of the things that have puzzled me for decades is that if you look at public opinion polls, people are much more generous than what their actual governments act upon. For instance, in all OECD countries, including Canada, if you ask people if they are prepared to pay 1% more taxes if that would contribute to putting an end to child mortality in Africa, people say yes, they would. The majority of people want their governments to be helpful in dealing with child mortality and poverty. So there is latent support out there where the transmission belt actually has never been created to translate that into sufficient action.

    Second, what I have found actually since 9/11 is that among audiences where there is the issue of poverty, the moral imperative doesn't really work that well. Since 9/11, people have much more understanding that what happens in a poor village in Afghanistan “can hit me too”. There is a feeling of global insecurity that we need to translate into a feeling for more global responsibility. That creates an environment in which politicians can take action to improve policies of rich nations on aid, trade, debt relief, etc., which has not been clearly there before.

    If we look at Canada, comparatively speaking, for the last decade Canada has not been among the most generous of donors. I am very pleased to see that the government has committed itself to double ODA by 2010. But even then, let me remind you of the fact that in Canada, in absolute numbers, in dollar numbers, the budget for the development corporation is less than half the budget I had as minister in the Netherlands. So the little Netherlands does more than twice as much as a huge G-7 country.

    In absolute terms, if we look per capita, the average Portuguese does more than the average Canadian, and Portugal is not among the richest. It's not a very generous effort yet, and even if you achieve the doubling of ODA by 2010, Canada will still be lagging far behind the average of the European Union. I always felt, as a European, that Canada was really part of us, or very close to us, in similar types of values. That is one point.

    The second point is effectiveness of aid. There is a general international agreement that aid should go to those who need it and those who deserve it. This is a very important point. You will only be able to get public support for your development effort if you really give it to countries that really need it.

    Now, the Canadian budget is really fragmented over more than 100 countries. There is no need to give money to middle-income countries that have access to the international capital market. It really would be great if Canada could focus more on countries that really need it and countries that deserve it. There is also a huge difference in terms of the quality of the governance in poor countries. There is no point in giving money to a government that doesn't set the right priorities itself, because then your money is wasted.

    Part of the skepticism, particularly in Canada, which is shown in polls on the development corporation, is that there is this image of foreign aid--that middle-income taxpayers in Canada bail out non-tax-paying elites in developing countries who steal from their poor.

¿  (0925)  

    Now, to explain, that this is not the way you spend your money. It's important to focus your money on countries that are poor and countries that have relatively good policies themselves. I mean, there are libraries written that have proven you lift 10 times as many people out of poverty if you focus aid on relatively well-governed countries than if you focus it on others. And there's too much geopolitics in terms of the list of countries that Canada actually focuses on.

    I'm talking too long. I know I'm in Parliament, so I'd better just say a few more things on trade.

    It's very important to realize that the impact of rich nations' policies on poor countries is much more important than actually your aid policies. I, as a development minister, was truly frustrated about how many effective projects we actually had in increasing milk production for poor farmers in Africa. The Dutch are good at producing milk, so that was an area where we did spend a lot of energy. But then the factory in Tanzania at the end of the day still would not buy the milk from the Tanzanian farmers because the common agriculture policy of the European Union subsidized the export of milk powder. So the factory wouldn't buy Dutch milk powder below production cost because it was subsidized.

    A similar example is the cotton subsidies by the Bush governments that have led to an absolute depression of wools, cotton prices, and thus really have killed rural livelihoods in Burkina Faso and Mali. What's the point of supporting rural farmers in west Africa if at the end of the day, with one stroke of the pen, the cotton prices internationally are so depressed that they can't sell their cotton?

    So there are these issues of trade. The example of the patent protection in the TRIPS agreement, which actually prevented affordable medicines going to poor people in poor countries, is really another issue of inconsistency of rich countries' policies that hurt poor people more than we ever can compensate with aid.

    So the essence of what I want to say is that goal eight, about what rich nations should be doing, is, yes, about aid, both volume and quality, but it's as much on issues of trade, debt relief, etc.

    Thank you.

¿  (0930)  

    The Chair: Thank you very much.

    I just want to say, before the questions and answers, that we've been very fortunate in the recent months to have had people coming before us such as some of your colleagues. We had in February a Mr. Mark Malloch Brown, and last month we met with Mrs. Mona Khalaf in New York. It's quite fascinating.

    Now we're going to start with Mr. Obhrai, please.

    Mr. Deepak Obhrai (Calgary East, Canadian Alliance): As a parliamentarian from Norway as well as being from one of the European countries...I presume your country is not a member of the EU.

    It's an interesting point that you have touched on. We ourselves feel it is the right approach. In my party, our policy recommendation is one of reducing and focusing on particular countries, as you mentioned, including the trade aspect as well as good governance and all these things.

    I'm originally from Tanzania. At one time a tremendous amount of aid was being poured into that country. You have rightly pointed out, and I can vouch for it, that quite simply everything went down the drain. Now, 40 years down the road, that country is in worse shape than it was at the time I left, despite the fact that a huge amount of aid was coming in, including from your country as well.

    On the millennium goal, I am having a little difficulty with that. I have discussed this with our minister, and regretfully the government is still hiding, in my view, behind the millennium goal. The millennium goal is a standard, but things have changed in the world. There are emerging economies, countries that can absolutely take care of themselves today, yet we sit behind the millennium goal by saying we're going to reduce poverty by 2015 and we're going to do this by this date. Some areas have disproportionately higher crises taking place, such as in Africa and some countries in Latin America, yet some countries in Asia--and China and India are particular examples, the emerging economies--are able to handle things. As you mention, they have access to the world financial markets and everything.

    I am interested in knowing how the millennium goal is able to take those things into account and move our resources into the areas where they are needed. I am a little skeptical of throwing money at them. I'll be very blunt about it. Just by saying we are going to increase development aid to 0.7%, as was recommended, without a concrete plan, without looking at the whole picture, is a very difficult sale for me.

    Having been a minister at one time in a country that played a very important role in development projects overseas, what do you think?

¿  (0935)  

    Ms. Eveline Herfkens: I fully acknowledge that we've been wasting a lot of money in the past in development corporations, but I really hope we've learned our lessons. Indeed, one of the things is that there is no need to give aid to China or, for that matter, to most of Latin America.

    I fully agree with the point you make, that the world is not simply very poor and very rich and there's nothing in between. The millennium development goal of achieving half the number of poor is a primary responsibility of the countries themselves. These goals are relevant for Ukraine with aid and they're relevant for Brazil where there's still a lot of poverty, but for Ukraine and Brazil, it's the primary responsibility of the governments themselves to do that. They shouldn't come for our handouts. China will achieve the goals; it's on track. There is no reason for us to help China achieve the goals. Brazil and Latin America are off track, but why? Because there is less equity in their own societies. They have to do a much better job in integrating the poor in their own economies and doing a better job with distribution.

    Rightly so, there is skepticism of people when they see aid going to countries where people are richer than people are in Canada or in the Netherlands. You're right, there should not be an effort from OECD countries to give help to emerging economies. It doesn't mean the goals are not relevant for them, but they have to achieve the goals themselves without outside help.

    The area I'm most concerned about is sub-Saharan Africa. I don't know to what extent you still follow what's going on in Tanzania, for instance, but after 30 years of lousy policies, they are really doing a terrific job. It's very, very hard. There are more good examples, such as Mozambique and Uganda, on the economic side. For the first time in sub-Saharan Africa, we have seen over the last years social indicators improving in some countries.

    These countries need help. Now we know how to help them. We don't make the mistakes of the past anymore. They deserve help. Now you can say that if you put money into the budget of the education minister of Uganda or Tanzania you contribute to getting hundreds of thousands of kids to school, because they have good policies by now. There is the need for more aid for the coming 10 to 20 years, but it should be focused on low-income countries, IDA or LDCs.

    Comparatively speaking, very little aid from Canada is going to exactly the groups that need it. Only 10% of your aid goes to the least developed countries. It's very, very low. Only 10% used to go to sub-Saharan Africa. These are the numbers before the great initiatives were announced, but nevertheless it was very, very low. For most of us in northern Europe, half of our aid goes to sub-Saharan Africa. That's where it should be focused. Then you can explain to your electorate that their taxpayer money helped get kids to school.

    One of the problems with Canada's aid is that if you spread it over 107 countries, you can't trace it anywhere. When I was a minister and I travelled, I used to have meetings with the five most relevant donors in countries. I never saw a Canadian. If you put a budget that is already less than half of my budget into 109 countries instead of into 20, you don't have the critical mass to be relevant anywhere. That's the type of reform you really need.

    If I may help you here for the debates of your Parliament, this is in the G-7 finance minister communiqué. Your finance minister signed off on the need to focus aid on poor countries that have good governance or good policies; I don't know the actual text. This is consensus and your finance minister signed on to it, so get them to implement it.

    The Chair: Thank you.

    I want to let you know that we've just done a small report for the Minister of Foreign Affairs concerning Canadian foreign policy, and it's a little bit on that targeting of the budget. I'm very pleased with your remarks this morning.

    We'll go to Madame Lalonde.

¿  (0940)  

[Translation]

    Ms. Francine Lalonde (Mercier, BQ): Thank you very much. I'll give you time to put in your gizmo.

[English]

    Ms. Eveline Herfkens: I do understand French, but I just want to make sure.

[Translation]

    Ms. Francine Lalonde: First of all let me thank you very much for your remarks. Some of my colleagues must have seen me smiling with delight while listening to you. The more so, since all this will be recorded in the minutes, and that we can revisit it. So, thank you once again and thank you for being so candid.

    What I also appreciate, in addition to this honesty, this clarity, this clearness, is your familiarity with the subject. We don't often have someone testify before us who has been able to test various methods, see the results and compare them over time and in different countries. This is very valuable and I wished to let you know.

    I have a few questions to ask you. After listening to you, it seems to me that one of the most important things we have to study, apart from what you mentioned concerning Canada, is the link between commercial practices and of course the agreements on rules of trade and development. But the extension of Doha, which seemed to go well, doesn't seem to be continuing so well, and we may well fear that these rules will stand in the way of the development efforts that have been made by some countries.

    I'd like to hear your comments on this and I hope that your remarks will be as clear as they have been on other questions. Of course, I'm thinking of the WTO, but there are also commercial practices.

    Also, it's difficult to have information about the example that you gave us concerning American subsidies that have killed cotton production in Burkina Faso. Where can we get information about this?

    The Chair: Ms. Herfkens.

[English]

    Ms. Eveline Herfkens: Thank you, and thank you very much for your nice words also. I'm really glad you asked about the trade and development connects because that is always really very hard to discuss.

    Actually, when I was preparing for this trip I was looking for a Canadian example on the trade side. When I go to Italy, I talk about subsidized tomato paste, and when I go to the Netherlands, I talk about Dutch milk powder, but I just didn't get around to putting enough research into it.

    In terms of information, if your committee would be interested, one of the best people on this is actually Nick Stern, chief economist at the World Bank. The World Bank does a lot of research on exactly these linkages on trade issues and development issues. The World Bank is a very well staffed, big organization. Second, your colleagues in the U.K. are working on a bipartisan report on trade and development. I don't know when it comes out, but they have been interviewing me at length for this. That might be something you want to look into. Third, Oxfam International has a report on trade. That was really focused on the European audience to destroy the common agriculture policy of the European Union, but nevertheless it's a good report. It also has good reports on TRIPS. These are the types of issues.

    By the way, one of the things I hope to do in the coming year as campaign coordinator is to create a Doha alert for interested parliamentarians, because one of the problems with the WTO is that it's very difficult for a parliamentarian. I remember in the eighties when it was still the GATT how difficult it was to find out what the issues were. They are very technical, but they are hidden behind technicalities, because of course it's very political. It's very difficult to get the information.

    One of the things I'm doing is working with different parliamentary assemblies, among them the Parliamentary Network of the WorldBank--I don't know if any of you are members of it--to try to create the Doha alert, to inform parliamentarians whenever issues come up in the trade round that “this is the issue and this is what ministers are going to decide”. Then it would be fantastic to have the same questions posed in 15 or 20 OECD countries. If we had had something at the time the TRIPS agreement was negotiated, we could have prevented a lot of disasters.

    The Doha round is really very worrisome. Every relevant deadline has been missed. We were supposed to have agreed internationally on the issue of affordability of medicines on New Year's Eve at the beginning of this year. The deadline has been missed. It's still not solved. It's partly solved, so that's good news. But it's not solved. The agriculture issue was supposed to be agreed to in terms of a framework for negotiations on March 31. The deadline was missed, so now with Cancun coming up in September it really is going to be make or break, and the trust of developing countries in the lip service paid in Doha is really fading away fast.

    As for the issues, this is one of the things I would like to campaign for. Trade negotiators always set deadlines, but one of the problems with goal eight, as opposed to the other goals, is that it has no deadlines. Can we campaign for deadlines? Then the issues would be these.

    First, end all agriculture export subsidies by, let's say, 2010. Second, end all tariffs and quotas that impact on products produced by poor people in poor countries, tariffs and quotas on textiles, clothing, and agricultural products. The present protection is such that there the trade barriers on products created by poor people are twice as high as they are on products created by rich people. We really have to make that playing field more level, so that would be an issue.

    The TRIPS issue is also an important one, and if I may put it on the agenda, it is one that I'm very concerned about. It's the whole issue of traditional knowledge, bio-piracy, knowledge that exists in indigenous communities and in developing countries that is then patented by OECD firms. These people are not getting any acknowledgement, any protection of their knowledge, or any remuneration for their knowledge. That should be on the agenda. TRIPS was absolutely development unfriendly, and that debate should be reopened.

¿  (0945)  

    These are the types of issues for Doha that should be on the agenda and dealt with in time. All these deadlines should be in advance of 2015, as 2015 is the outcome, the output date, and these trade agreements are the input of rich countries to help that output. You can't have your cheque still in the mail if we want to achieve the goal for 2015--halving the number of poor. The same goes for your ODA cheque, by the way. As for being halfway in 2010, when is Canada going to be where you're supposed to be, that is, at the 0.7%?

    The Chair: Thank you.

    Mrs. Redman.

    Mrs. Karen Redman (Kitchener Centre, Lib.): Thank you, Mr. Chair.

    I thank you for coming here and for being so succinct and directed in your comments.

    You mentioned that the world changed after September 11, but I will tell you what I found very interesting. I think our Prime Minister was extremely candid, but he was roundly criticized in certain quarters when he talked about poverty and the base issues that are very fertile ground for terrorism to grow in.

    I know you've talked about focusing and I totally agree with that. I don't have a problem as a public representative to go to my constituency and say that I think we have an obligation to continue to invest internationally, but we as a country sometimes get criticized for dealing with countries that have very poor human rights track records. I wonder if you could just comment on what I support, and what I think this government's direction has been, which is that we're far better to be talking to them through the avenue of trade rather than just lobbing rocks at them from the bushes because they're not doing what we'd like them to.

    Could you also comment on the model Canada has used? I'm thinking of some of the CIDA programs, of how the corn shares program, for instance, leverages a lot of money from Canadians who invest in what they see as worthwhile programs, which leads to international investment in grassroots projects that make a difference to people in those countries.

    In the past we've also had witnesses who have talked about the unique relationship that Canada has achieved over the years with the non-government agencies, yet sometimes I hear at home that people are very suspicious of agencies where you hear allegations of corruption, you hear the aid is not going where it needs to, and they feel far more comfortable going through the government programs because there is some assurance the money is going where it needs to go. I wonder if you'd comment on those aspects of helping the poorest countries.

¿  (0950)  

    Ms. Eveline Herfkens: Yes. On the first point, the relation between terrorism and poverty is not one to one, but what poverty does is it snatches away hope and opportunity for young people, and that creates a fertile breeding ground for terrorism, so there is a linkage but it's not a one-to-one linkage.

    On the human rights issue, I am absolutely in favour of focusing aid only on countries that have good governance and good policies, and good governance includes democracy, etc., but there is no black and white situation. No country is perfect, including my own. We have corruption and scandals at home. I don't know about Canada, but we are not perfect.

    So it's very hard, and there must be some understanding that there is a relation between degree of poverty and quality of governance. If you can't pay policemen a decent income, they tend to beat up people. I'm simplifying, but there is a relation between the degree of development and your economic situation, the degree to which you are able to invest in good institutions like parliaments and general accounting offices, etc., and pay good salaries for civil servants so they don't need to be corrupt and can actually support their children to go to college.

    There are relationships there, so it's not that black and white, but you should compare countries with countries with the same level of development. Then you really see differences. Just look at Africa. Zimbabwe stinks, and deeply, let's be honest. Relatively good are Mozambique, Tanzania, and Uganda, but don't say they're perfect, because Mozambique is in a very difficult transition from a one-party state to a multi-party democracy, and it takes a long time--a little bit too long, in my view. But they have very good economic policies and a very good focus on meeting the millennium goals. If you take your perfect standards from our society to them, no country would be good enough, but relatively speaking.

    So I'm very much in favour of looking at governance, but not only human rights, the whole of it. How do they spend their own resources? Do they spend within their own budgets sufficient for primary education, which is as much a part of good governance as the human rights or democracy side? That's it on that point.

    In terms of engaging your society, actually my own country is similar to Canada in terms of the long-standing relationship with the NGOs. Our history is very much one of missionaries, etc., so from the beginning of the development corporation we channelled a fixed percentage through a Roman Catholic NGO, a Protestant NGO, and a neutral NGO. Our society has all these different pillars. We did that too.

    Now, is this good or is it not good? I felt we had gone too far in the Netherlands with spending money with the purpose of engaging partners in the Netherlands society in the development corporation, to a degree that the spending itself was not effective. Partnerships sound nice, but you really should wonder to what extent Dutch or Canadian expertise is relevant in a situation in Africa.

    Actually, a lot of development corporation money that was meant to build institutional capacity undermined institutional capacity. We always thought we knew better, and here the wise guy comes and lectures and leaves again, and it has not been always helpful. From that perspective there is a conflict between the effectiveness of aid and the involvement of your own nationals or your own national institutions. Taking a very good look at that conflict is important, I think, but it takes political guts because there are vested interests out there.

    Let me give you just one quick story, Mr. Chair, if I may, from what I've experienced myself as a minister when I tried to cut out all these vested interests in our programs, which I felt were not consistent with effectiveness.

    We used to have an organization that sent Dutch doctors to practise in Africa. This is not the humanitarian side. There were Dutch doctors in Ghana. Now the problem in Ghana is that the Ghanaian doctors go to London and Washington to practise. In the meantime, we send Dutch doctors who are way more expensive than Ghanaian doctors because--well, there's the salary before they go and practise, plus perks because they want their four-wheel drives and their refrigerators for medicines.

    For that money I could, per Dutch doctor, keep 20 Ghanaians home, because it doesn't take much. People prefer to stay home. They don't want to go to other countries. If you are a doctor and you're not sure about getting your salary and you don't have your refrigerator and your four-wheel drive, it's so much more attractive to practise in Washington. So with one Dutch doctor I could keep 20 or more Ghanaians. So I agreed with the Ghanaian health minister to withdraw all the Dutch doctors and give him the money for his budget to top up salaries and facilities to keep more doctors there.

    Now, the Dutch organization sending our people had no purpose any more and had to be abolished, so they started complaining against me, with slogans that I was killing African babies by withdrawing Dutch doctors. I just want to tell you that it takes some political guts to go against vested interests in your own society, but if you care about your aid effectiveness, which is the only way your aid programs can survive, you really must look into these issues.

    I'm sure you saw the peer review of Canada in the DAC. This was one of the main issues brought up. You do have that, don't you? I would hope you discuss it. In the DAC, donors have to come every two years to be reviewed by their peers in terms of quality. The Canadian debate was actually a high-quality debate. Susan Whalen went there herself. It really points out the weaknesses. I always got my Parliament to debate our peer reviews because it was an important way to get political support for improving effectiveness.

¿  (0955)  

    The Chair: Thank you.

    Now we'll go to Mr. Martin.

    Mr. Keith Martin (Esquimalt—Juan de Fuca, Canadian Alliance): Madame Herfkens, if I only had one word for you, it would be bravo. We need you here. Thank you for your impassioned speech and your effectiveness. It is truly outstanding, as you've heard from my colleagues.

    My first comment is really a request.

    You mentioned Nick Stern and Oxfam. If UNDP has put out any proposals concerning the WTO negotiations, we would certainly, as a committee, appreciate anything that the UNDP has put out on those requests that they have to make TRIPS and other issues more effective.

    My first question relates to worst case scenarios. For those countries that are in the worst situation, corruption and political decisions, as we know, have caused enormous problems. You cited the case of Zimbabwe, the Congo, and you can go down the list. Those people are voiceless, yet their pain and suffering are extreme.

    My question for you is, is there a mechanism or would you propose a mechanism that the UN can apply through a measure of carrots and sticks, incorporating the levers of the World Bank and the IMF as well as the UN, to apply to those despots who are intent on causing enormous suffering for their own benefit. I cite perhaps the case of Uganda and what Mr. Nsibambi is doing in the Congo as one of a litany of examples.

    My second question is this. Stephen Lewis mentioned that with an HIV prevalence rate exceeding 5%, pouring development money into those countries is completely ineffective--a chilling statement. I wonder if you would--

À  (1000)  

    Ms. Eveline Herfkens: What did he say?

    Mr. Keith Martin: He said that if there's an HIV prevalence rate that exceeds 5%, pouring aid money into that country will have no effect. I think just because of where you are, on the cusp of where that HIV rate is going, that you're actually eviscerating the economic workforce, that demographic within a country, and therefore no matter what we do in terms of pouring aid and development money into that country, it cannot have traction because of the sheer numbers of people who are dying or will die in that critical demographic mass in the country.

    Would you agree with that or not? If so, how would you deal with that?

    Lastly, relating to that, how would the millennium development objectives fit into that? It is essential to sub-Saharan Africa, as you mentioned.

    Thank you.

    Ms. Eveline Herfkens: I'll start with the last one. Goal six is about AIDS. What I really like about the process that we are now developing in developing countries is the degree to which countries actually customize the package of the goals to their own situation. The Millennium Development Goals Campaign report of Lesotho, for instance, is basically starting out with goal six, and all the other goals are derived from or linked to goal six. So the AIDS goal is in countries, particularly southern Africa, one of the most important goals in their local focus in terms of implementing the package. But again, there are the linkages, so we cannot forget about the other goals.

    The linkages between AIDS and education is the best way to prevent AIDS. First get people to read and write, because then you actually can get the information to them. On the other hand, the linkage in Zambia is that more teachers are dying now than the government is capable to train. So we still always have to look at the whole package. But AIDS is among the millennium goals, particularly in Africa and Sub-Saharan Africa., and the main goal we focus on in our efforts in developing countries. So that is happening.

    Now, on what Stephen Lewis actually said, I know him very well from the 1980s when we worked as parliamentarians, and like me, he is sometimes passionate and exaggerates. So I wouldn't agree with the way you now phrase it. I don't know if he said it that way and in what context, but I also once in awhile get very passionate, and then people quote me back, and I think, oh my God, that is exaggerating.

    I believe we have to focus much more of our aid in these countries on AIDS prevention, AIDS treatment, and issues related to AIDS. That is exactly what is happening. One of the things that we in Europe are so irritated about with the Bush PR thing at the G-8 is exactly that for decades we already have been doing that, but not simplifying it. If only to pay for the medicines, aid would work in these countries still.

    Mr. Keith Martin: Is there a role, Madame Herfkens, for the UNDP to act as a coordinating body for the countries that are tripping over themselves trying to do the same thing in a country? It really must be grating and disappointing for you to see that. Is there a role for the UNDP to--

    Ms. Eveline Herfkens: I wish there were. The real world is that sovereign nations don't let themselves be coordinated, particularly not by the UN. So if you think President Bush accepts to be coordinated by Mark Brown and me, it would be a good world, but it's not the way it works. But there are more efforts now for donors to work together than I've seen in 25 years.

    If you want to get into the depth of the debate of quality of aid, I would like to refer you to the conference that took place in Rome in February where all donors committed themselves to harmonizing their procedures and working together. One of the reasons that aid has not been effective is this. Imagine you're a civil servant in the health ministry in Zambia, and there are only two of you who are good. You spend all your time writing reports for 30 different donors with 30 different reporting requirements, and your minister spends all the time wining and dining visiting development ministers who want to open hospitals. So this type of scattered, fragmented aid effort of all these different projects has been an absolute disaster.

    Donors have, over the last years, committed themselves to harmonize procedures, act together, and work together. I had organized in northern Europe very close coordination. For instance, the Netherlands was not in Malawi, but I gave my money, through DFID, the British CIDA, effectively. I was active in francophone Africa and the British were not, because they don't have diplomats who speak French, so I handled part of DFID's money in our programs there. That means the number of headaches for different donors is being reduced. We should do much more of this. CIDA is doing one or two pilots here, I think, but way too little.

    So this harmonization effort, Conference of Rome, the high level, you will find on the net. Both the DAC and the OECD websites have reference to it, and maybe your clerk can help you find it--and the World Bank site. But again, this is a commitment of donors without a date, so here they say beautiful things again.... One of the problems in global governance is that we make these wonderful statements internationally and we take the plane back home and go back to business as usual. When my prime minister came back from the millennium assembly, I said “That's very interesting. Can we have a debate now in the cabinet on what it means for us? He said, “Huh?” Well, we had it, and I think we were the only country that had it.

    This is really a problem, and this is where parliaments come in. It's only parliaments that can make governments accountable to what they actually internationally promise, and that's why we, as a campaign, want to develop all kinds of ways to work with parliaments, because that's the big problem in global governance.

À  (1005)  

    The Chair: Thank you.

    Ms. Eveline Herfkens: I haven't answered everything, I'm sorry.

    The Chair: But we'll come back.

    Mr. Eyking.

    Mr. Mark Eyking (Sydney—Victoria, Lib.): Thank you, Mr. Chairman.

    Thank you for coming today.

    I'm well aware of the Netherlands and the record they have in underdeveloped countries. My parents are from Holland. My father's from the north, my mother's from the south. I have three cousins working in underdeveloped countries. When I talk to them, I'm always impressed with how they engage young people to work in underdeveloped countries, and also the public, how aware they are of their country and what it's doing. I think we should look at that a bit.

    When we look at the United States, their size, how they have their own political goals and the way they do their own thing, sometimes we're left out a little bit in our modus and what we should be doing. I see the way a lot of European countries are. I think we're more like-minded in how we do things or should do things.

    Should our relationship maybe be closer with the European countries as far as foreign aid is concerned, and--I brought this up before with another witness we had--should we be dividing Africa up into sections or areas? I'll just use an example, where maybe Canada takes care of a couple of countries, not adopting but focusing on those countries. We would send our young people there and we would have reports and that kind of thing instead of, as you mentioned, being all over the place, with no impact. I'm just thinking, if we were sitting and talking to countries of Europe and whatnot and said, okay, you focus on Zimbabwe or focus on a certain need, that way the Canadian public would know what we're doing and would have a bit of pride in the progress and things like that.

    Ms. Eveline Herfkens: Yes. The engagement of young people is indeed very good. Maybe I can make a remark here.

    In all countries that actually achieved the 0.7% in the seventies and have kept at that level, we have implemented also the UN resolution to spend at least 1% of our ODA budget for development education, to make people aware. Out of that budget, you have this twinning and travelling of young people, and arrangements, etc. It's a fantastic investment in a long-term constituency for development assistance to actually have a good public engagement program.

    In terms of where Canada is and whether it is with us in Europe, I recall that in the seventies, when I started my career, there was a formal like-minded group. That was Canada with northern Europe. But then Canada sort of moved out of that, partly because of its decline in ODA. Why would you want to coordinate with a country that doesn't have a budget that makes it worthwhile coordinating with? I'm speaking very harshly now, but one of the things that we in northern Europe have always very much regretted actually is that Canada in fact left the group of like-minded.

    At the time of the seventies and early eighties, the time of Maurice Strong, Canada was one of the driving modern donors, ahead of the pack, and really a lead country in development aid. Now, somewhere that got lost, and I never understood when that happened. It's not up to me to discuss why that happens--maybe partly because CIDA is a separate agency. I thought maybe if it had been the development minister running it, then you would be having that debate at a higher political level, but I cannot judge it. You used to be northern European like-minded. I would be so happy--we in northern Europe--to welcome you back again in that group.

    Now, the Europeans have very bad experiences with dividing Africa, and there still is a problem. There are a lot of conflicts in Africa, where there are serious problems with the Brits and the French and the whole Congo area. It is very risky to do it that way, to do it to that extent. But if Canada were able to focus on 20 instead of on 109, mostly in Africa, you would have the advantages of what you sketch. Then you would have the critical mass to show your people what you actually have done. Then there is much more room for edification, and then you stop the waste of money of all your bureaucracy that has to have in-country knowledge of these other 80 countries. That's what effectiveness means.

    The way aid works effectively is if you delegate to the field. How can you have CIDA people in 62 countries? That's not serious, unless you spend half of your budget on overhead. I decided, with a budget more than twice as big as the Canadian one, that we couldn't be effective in more than 20 countries, and that's with more than a double budget.

    So, indeed, it would already be helpful. Then you would be visible. Then you would be one of the actors. But you don't want to give countries to just one donor. There's just too much of a power play and politics behind it, particularly with us Europeans, with a very bad track record. Maybe Norway and Canada could do a better job; however, Europeans would say, here we are, neo-colonials taking over again. You don't want to do that.

À  (1010)  

[Translation]

    The Chair: Mr. Harvey, please.

    Mr. André Harvey (Chicoutimi—Le Fjord, Lib.): Thank you, Mr. Chairman. Let me thank our witness. I think she's lucky because everything seems easy for her.

    I'm new in the area of international cooperation, I'm not an expert like you, but it seems to me that the results up to 2000 have been judged pretty harshly. Rather than blame our country, I'd be more inclined to congratulate it on not having invested more in a bottomless pit. Indeed, if international aid has been largely ineffective--and I'm going to speak honestly--, I think that it may be have been caution on the part of our fellow citizens. When people talk about international cooperation, obviously they want to help all the countries that need it most, but very often we're asked questions about the relevance of international aid and its effectiveness.

    I've only been sitting on the committee for a few weeks, but I think that for a year and a half or two, since the Millennium Declaration, since the latest international conferences, particularly at Kananaskis, we have begun an interesting period in international cooperation. Accordingly-- you are no doubt aware of this--, our country has decided to focus more on countries that would benefit the most, including six African countries, called the group of nine. For several months, the government has undertaken major consultations in the agri-food area and the emergence of the private sector. Before, we threw money around all over the place, but the results were ineffective.

    So, instead of blaming our government or our country, because our country has been led by different governments, I say that we demonstrated caution because international cooperation was a bottomless pit that was out of control. Now, you tell us that it was beginning to be more rational.

    I'd like to ask you what you think of the fact that we have focused more on countries that have good governance-- as you recommended two or three times in your evidence--, so that we can say to our fellow citizens that our investments in foreign countries are 80% effective instead of 25%. Especially since I never fooled with the 0.7% of the gross domestic product. Why not work more on improving the effectiveness of international aid so that I can say to the people of Quebec, the people of Ontario, and the people of western Canada that our investments of $2.5 billion are effective, that they are good and not an embarrassment?

    Thank you.

À  (1015)  

[English]

    The Chair: Ms. Herfkens, there are differences of opinion.

    Ms. Eveline Herfkens: Yes, of course. I would be scared if you didn't have differences of opinion. Otherwise I would think it is the soviet system back again.

    I totally agree with you that the issue of effectiveness is crucial. If you want to build long-term public support for a development corporation, you have to deal with the effectiveness issue. I know Canada has announced its intentions to focus aid more on poor countries with good policies, but it has not been done yet. Even so, these intentions are rather vague. It's only focusing the increase of the ODA that is coming on poor countries with good policies.

    When I became a minister, I said that during my term we would end all aid to middle-income countries and we would concentrate 50% or 60% of the aid on the poorer countries. We had exit strategies for all countries that didn't fit. This is somewhat more radical than Canada is doing, because you're continuing with 107 and you're just focusing on the increase. It will still, comparatively speaking with other donors, leave you with very low numbers focused on poor countries with good policies.

    I'm sorry if I come across as blaming Canada, but I'm just giving the facts compared with other donors. On some of these issues, except for the United States, you're somewhere at the bottom compared with others.

    I am very pleased about the recent reforms and the recent announcement, but it still has to be implemented, and it's not that radical, actually. It is important exactly because of the point you made about effectiveness. Aid is only effective if you spend it on countries that need it, really poor countries that have relatively good policies. If you do it the modern way instead of the supply-driven projects, but working together with other donors to support government programs of the recipients, then you can show your electorate that aid works.

    One of the things I really want to commend the Canadian government on is actually reporting to its parliament along the lines of the millennium development goals. People do understand the millennium development goals. This will enable you to go back to your electorate and say, taxpayers, thanks to you, we were able to get so many more kids to school. The millennium goals are a very good means of communication to actually link increased effectiveness to increased public support.

    The Chair: We will go to Mrs. Kraft Sloan and then Mr. O'Brien and Mr. Harvard.

    Mrs. Karen Kraft Sloan (York North): I hope you have some time in your very busy schedule to write a book about your experiences and your advice. It's been very helpful this morning.

    I am very pleased to have this overview of the millennium program. I believe it provides an incentive for countries in the south as well as accountability for countries in the north.

    I am concerned however, that good words, as you have said, result sometimes only in business as usual. I'm very interested in the issue of good governance and the criteria, and you have talked a lot about the criteria. However, it seems that there is a preponderance of creating lists in the world. Sometimes you are on the axis of evil list and sometimes you're not.

    My concern is this. Will the countries and the criteria be identified in terms of what is in the interests of the donor country? Good governance will then be seen in that particular light. Those objectives will be massaged to produce that sort of list as a result. Could you give me some assurances on that front and a measure of your very pragmatic approach on this?

    Also, it was pointed out to me by one of the researchers that in your timeline chart on the back, for example, goal seven of ensuring environmental sustainability, you're really looking at very basic operational measures for that particular category. There is no inclusion of goals around HIV/AIDS as well. You might want to address that.

À  (1020)  

    Ms. Eveline Herfkens: Goal six is HIV/AIDS.

    Mrs. Karen Kraft Sloan: It's not on this chart.

    The Chair: No, it's on the little chart.

    Mrs. Karen Kraft Sloan: Oh, it's on the little chart. No, but it's specified as a goal overall for the millennium development goals, and it's not included as to when it might be included on the timeline.

    Ms. Eveline Herfkens: I just handed it out. It was printed for the G-8. It just came out and I took 10 with me; I grabbed them as I left the office to give to you. I actually haven't even studied it myself.

    Mrs. Karen Kraft Sloan: Oh, all right.

    Ms. Eveline Herfkens: And I really stole 10 of them, because they were not yet supposed to be--

    Mrs. Karen Kraft Sloan: I'd better not wreck it.

    Ms. Eveline Herfkens: Maybe it's because that is the goal; reversing the epidemic is more difficult to actually grab in a timeline, I don't know.

    Mrs. Karen Kraft Sloan: Yes, or acceleration....

    Ms. Eveline Herfkens: Yes.

    Mrs. Karen Kraft Sloan: Maybe you would want to send something back to the committee about the link between the smaller millennium goals that have been identified, because actually there are eight millennium goals and two of the timelines are broken.

    The Chair: The report will be coming out in July. I'm going to ask the witness if it's possible to send every member a copy of this report that's going to come out in July, next month. This is a little bit soon, but we got it firsthand today from Ms. Herfkens.

    Thank you.

    Ms. Eveline Herfkens: Maybe the data were not available. That's also possible. One of the problems we struggle with is getting good data on these types of issues.

    Now, what was your first issue? Sorry, I've had a blackout now because I've handed out a paper that I haven't got myself.

    Mrs. Karen Kraft Sloan: My issue was on the criteria identification and whether it was going to end up being in the donor countries--

    Ms. Eveline Herfkens: The criteria, yes.

    There is one thing I forgot to say in the opening remarks. You know, I'm very Dutch in terms of being very straight and critical and not saying a lot of nice things first, the way southern Europeans would. The nice thing I would like to say is actually the effort that Canada invests in multilateralism. It's exactly the multilateral decision-making that prevents the type of worries that you are, and rightly so, concerned about.

    The Americans came up with a millennium challenge account focusing aid on poor countries that have good governance. They have phrased their own criteria, which are slightly different from what you or we would have done, but for a bilateral program, what can you say? That's up to the American government.

    The good thing is that within the World Bank's strategic partnership with Africa, there is work going on that is guided multilaterally by all of us, so we neutralize. That doesn't mean there is not always an effort, and it's not only the U.S. The French have a clear geopolitical agenda also and have a great interest in having their former colonies judged slightly more positively than others might want to do. It's the multilateral decision-making that ensures that indeed there is a type of fairness to these types of judgments. But it's a very long debate because it's very, very difficult. A lot of work has been done, particularly in defining governance for IDA. I don't know if you do this in Canada, but one of the things I really got done in the Netherlands was getting our executive directors representing us at the World Bank and the IMF to report and be accountable to the parliamentary committees.

    Your World Bank executive director should be able to tell you exactly everything about the way the country governance is being assessed in that multilateral group, which is the leading group on this issue. I've even forgotten the abbreviation for it. It's partly technical but in the meantime it's one of those issues that are seemingly technical but really are very political.

À  (1025)  

    The Chair: Thank you. Knowing you have another commitment at 11 o'clock, I'll ask if we could keep you here for another 10 or 15 minutes.

    My colleagues will have a second round, but with just one question and no rambling. We'll go to Mr. Obhrai, and then to Mr. Harvard, Mr. Martin, and Madame Lalonde.

    Mr. Deepak Obhrai: Aid effectiveness and vested interest are words that you used. It is interesting. I just came back from Mexico City. On that conference on bridge building in Monterrey, there was emphasis on agriculture as being one of the key areas responsible for poverty. Yet when we talk about aid effectiveness and vested interest--the European subsidy, the French subsidy most importantly, and the German subsidy--in part of the European Union there is a total disregard that giving out this money by a subsidy is having a devastating impact on the third world countries. The aid budget is peanuts compared to that subsidy.

    While in Canada, as you have stated, our ODA has been going down, and you're criticizing it, I think a severe criticism from everybody toward the European Union for that subsidy should be where we say that aid effectiveness has fallen to zero because of those subsidies that are killing the farmers out there. Would you not agree?

    I would like to see the United Nations and your organization come out more strongly in attacking the European Union. I was surprised that the French foreign minister totally disregarded foreign aid and said that the European subsidy was for them a vested interest. Can we not, from your organization as well, move the subsidy from somewhere sitting in the middle right to the top as being part of aid effectiveness delivery to the developing world?

    Ms. Eveline Herfkens: I hope you raise the question in Canada too, because I have the numbers here. I'm always attacking the European Union policy, and because I'm European it is easier, but also because on these policies they're the worst of the lot. But that doesn't say that the rest of the OECD are saints.

    The European annual subsidy per cow per year is $436, which is higher than the income of most poor countries annually, by the way. Cows are subsidized with more money than half of the population in the world lives on. But Canada's support per cow is $131, so it's not that you're not giving any agriculture subsidies, and I would be interested to find out to what extent.... Indeed, in Canada also it wouldn't surprise me that in fact what you give in agricultural subsidy also dwarfs your ODA budget. I don't have the numbers again, because I didn't get into the Canadian details that much.

    I don't know if you know about Foreign Policy and the first effort ever made to actually rank the rich. We have this great habit in development corporations to compare poor countries and beat them up if they are not doing well. This is the first effort of the Global Development Center, an independent think-tank in Washington, to rank the rich. This has been published in this month's Foreign Policy.

    Canada doesn't do perfectly either. You're doing fairly well on immigration. Actually in Europe we're getting parliamentary debates around this index, so you might want to have a look at it too. The clerk might want to distribute this.

    The Chair: These figures are until 2000, correct?

    Ms. Eveline Herfkens: Yes, that's what you always have with ranking things.

    The Chair: Okay, that's fine.

    Ms. Eveline Herfkens: I'm sorry, that's always part of the problem.

    The Chair: Yes, I know.

    Ms. Eveline Herfkens: Nevertheless, this is going to be an annual exercise and we hope that competition will start.

À  (1030)  

    The Chair: Mr. Harvard.

    Mr. John Harvard (Charleswood—St. James—Assiniboia, Lib.): Before I go to the witness, could the clerk arrange to have that paper distributed to all of us?

    The Chair: Yes.

    Mr. John Harvard: To the witness, I really appreciate your straight talk. Don't feel for a moment that you have to apologize for anything that might be construed as criticism either of Canada or any of our programs. I think criticism and debate are good for us.

    I have two comments. One is that it makes a lot of sense to me that we focus our foreign aid efforts on a handful of countries as opposed to focusing on many countries and spreading our aid very thinly, where perhaps we don't do a whole lot of good in any country.

    My first question would be how much effort is there on the part of countries involved in foreign aid in coordinating their programs? It doesn't make sense to me that through the vagaries of aid one country would get an abundance of attention, let's say--not aid, but an abundance of attention--from a whole lot of countries, whereas another country for some reason, again because of the vagaries, would somehow be overlooked. It would seem to me that Canada, for example, would have a particular kind of expertise and knowledge that would fit for some countries and perhaps not for others. If there were some kind of coordination, that would make sense to me. I don't know whether that's happening.

    The other thing is that I missed your opening presentation, but you skipped over the comment about our supply-driven programs. I suppose the opposite of supply is demand, and I'd love for you to flesh that out a little bit for me.

    Those are my two questions.

[Translation]

    The Chair: Ms. Herfkens.

[English]

    Ms. Eveline Herfkens: Indeed, one of the things that are very hard for us in the donor business and for our populations to really understand is that we don't develop them, they develop themselves. This is a mindset that is really very difficult to get to, even for donors, or maybe particularly for donor agencies.

    Way too often, instead of going there and listening and understanding what were the priorities of the people themselves, the poor who are the experts in surviving and who know what they need, we came with our ready-made solutions. We are all very pleased about the way we developed and think that the way we organize our society is great, but that doesn't mean in a totally different culture that type of solution would fit, too.

    Modern development assistance, effective development assistance, is demand driven. It is built on priorities set, priorities phrased, policies developed, homegrown, by people and countries themselves. Otherwise it simply doesn't work.

    As for the old-fashioned project approach, the Dutch were terrible also on this. We had rural integrated development projects, and then our experts would run part of a country. Geographically limited, we would create a little paradise in an ocean of misery. Our project was very successful, but it was very micro, only in that little area. Then the Dutch experts left and the island went under in the ocean. There is no sustainability unless it is embedded in the policies and priorities of the countries themselves. The demand-driven issue is extremely important.

    On coordination, maybe it's possible for the research staff to inform you about that Rome meeting. The division of labour in terms of sharing countries is very hard. Everybody has in a way geopolitical agendas. You have your diaspora here, which means there are places that you cannot but have some relation with. Europeans have their histories, helpful or not.

    Let me give you an example. I always told my French and British colleagues that they only cared about African babies if they grew up to speak French or English, respectively, for British aid, etc.

    There is an issue of donor darlings. It is true that some countries get more attention than others and other countries are overlooked because the people speak French--or worse, Portuguese, because Portugal is not the biggest donor in the world--or because they're small.

    The answer here, and I forgot to mention this earlier, is the multilateral system. There are fantastic initiatives. I make this point all the time to U.S. audiences. Internationally, the multilateral system has wonderful delivery mechanisms on whatever subject you want. UNICEF deals with children. UNEP is into capacity building. The World Bank has fantastic education for all fast-track initiatives. There is the global health fund. They are totally starved of funds, totally underfunded. For the whole UN operational system put together, the budget is smaller than my budget was. It's totally starved of funding.

    These forgotten countries cannot but rely on the multilateral system. That's why investing in multilateral systems is so important. I hope that as Canadian ODA grows, you keep that good practice of at least one-third multilateral. We have the numbers; exactly one-third is multilateral. I hope you keep that up, because that deals with the forgotten people, forgotten countries, forgotten crises, which are not on the CNN screen.

À  (1035)  

    The Chair: We'll have one question from Mr. Martin and Madame Lalonde, both together. I know you'll come back; that's why one question, please, both together.

    Mr. Keith Martin: It's a tragic irony, Ms. Herfkens, that in the poorest of the countries the people are poor, the countries are rich, and despots capitalize on that situation.

    My question is simple. Do you believe that in utilizing these multilateral mechanisms through the bank, the IMF, there should be a graded series of responses, hard, tough responses, focused against these despots that would make them pay a price to cease and desist their activities? Either use it as a carrot or as a stick.

    Ms. Eveline Herfkens: That was exactly the question I didn't answer.

[Translation]

    Ms. Francine Lalonde: One of your statements really struck me, because I think that it is perfectly relevant, at least for practices here. You said that if we want to develop, we have to delegate to the countries, and if we require endless reports for little tiny programs, a large part of the money is going to be spent on bureaucracy.

    But if CIDA began to make endless reports, it's because there were requirements here, particularly by some parties, concerning the cost-effectiveness of those programs. But it seems to me that they're chasing their tails.

    So, would you be more specific when you say we have to delegate? How are we supposed to do it?

[English]

    Ms. Eveline Herfkens: The problem of many developing countries is the poor countries that had all these donors they had to report to. The basic focus of accountability was to the international community and not to their own people, because two civil servants had to write all these reports. What we tried to do with this harmonization, the Rome conference thing, is actually get together and see how we can prevent this. How can we agree on common reporting so the country concerned only has to make one report to the donors?

    Ultimately they have to be accountable to their own parliaments and to their own people. What you want to care about is much more than how they do their report, including on their own resources. Let's not forget that even in the most aid-dependent country, most of the resources come from the country itself. There's no country in the world where more than 5% of the education budget is financed by outsiders.

    In order for these countries to develop, it's much more important to get them to report on the 95% to their own parliaments. It's important to create auditing systems and strengthen their parliaments in order for them to know how to read a budget and see if it's pro poor and has good priorities, to strengthen general accounting practices rather than actually focusing too much on all these individual reports to all these little individual donors. That harmonization effort will be extremely important.

    Most donors don't make decisions in headquarters anymore because they know that a blueprint for the development of Tanzania cannot be written in Ottawa. Most of us have actually delegated to the field the decision-making on our aid program. You can't do that if you are a tiny outfit like CIDA spread around 62 countries; otherwise three-quarters of your money is used in overhead.

    Mr. Martin, I'm sorry, I didn't get around to answering your question.

    On the issue of countries in conflict, bad governance, etc., the problem is that outsiders have very much less influence on trying to create peace or getting the rascals out than you and I might want them to have. There has been more and more serious work done about the actual cause of conflict. I would like to refer you to the book by Paul Collier that just came out.

    Which countries are most conflict prone? There are countries that are basically very poor and have fantastic natural resources. How come? Rebels can steal diamonds. In some of these conflicts there is a vested interest for rebels to continue to steal. As the country is poor, there is no hope for young people; their best career is to join the rebels. Who am I to judge that? Action against that has indeed started now with the blood diamond action, which is trying to prevent a market for that kind of stuff. It undercuts the economic base of these rebels and is the best way to go.

    Be in time with peacekeeping efforts, the moment there is a window of opportunity. The international community also has a track record of being too late in many of the African crises. We're doing better. In Yugoslavia, we were a little bit earlier. In peacekeeping, there's still a long way to go in improving that. By the way, that's one of the areas in which Canada is great. The Netherlands and Canada were in Eritrea and Ethiopia at the beginning. As a development minister, I was there, and I recall seeing your Mounties with the UN blue hats at the time.

À  (1040)  

    The Chair: I just want to say two things to Ms. Herfkens. First, the material you handed out this morning is, I understand, from the new human development report that will be published next month. I know all members will find this very useful. I wonder if you could speak with our clerk after the meeting just to be sure everyone will receive a copy when it is published.

    Second, our Subcommittee on Human Rights and International Development has just prepared a report on humanitarian catastrophes in Africa. We'll be tabling that report next week and we will send you a copy. If you have any comments, we'll be very pleased to get your feedback.

    In closing, I would like to express our thanks to you for sharing with us your work and experience. I'm sure your passion will certainly be contagious to us. I also want to say that you've got an open invitation to meet with us every time you're here in Ottawa .

    Once again, thank you very much.

    Ms. Eveline Herfkens: Thank you.

    The Chair: We will recess for five minutes, and after that we will go in camera for future business.

    Thank you.

    [Proceedings continue in camera]