Aid
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Aid quality is just as important as aid quantity, so the CDI measures gross aid as a share of GDP adjusted for various quality factors: it subtracts debt service, penalizes “tied” aid that makes recipients spend aid only on donor goods and services, rewards aid to poor but relatively well-governed recipients, and penalizes overloading poor governments with many small projects.
Canada’s aid performance
Strengths
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Large amount of private charitable giving attributable to tax policy (0.02% of GDP; rank: 3)
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Small share of tied or partially tied aid (5.19%; rank: 10)
Weaknesses
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Low net aid volume as a share of the economy (0.32%; rank: 14)
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Allows project proliferation; small average project size (rank: 15)
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Trade
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International trade has been a force for economic development for centuries. The CDI measures trade barriers in rich countries against exports from developing countries. It also penalizes costly importation processes and restrictions against purchasing services from foreigners.
Canada’s trade performance
Strengths
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Low agricultural subsidies (equivalent to a tariff worth 8.2% of the value of imports; rank: 4)
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No tariffs on rice (0% of the value of imports; rank: 1)
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Low tariffs on sugar (3.6% of the value of imports; rank: 3)
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Low tariffs on beef (13.2% of the value of imports; rank: 4)
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Few days to import a shipping container (4 days; rank: 5)
Weaknesses
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High tariffs on textile (10.4% of the value of imports; rank: 26)
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High tariffs on wheat (41.6% of the value of imports; rank: 24)
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High tariffs on dairy (184.4% of the value of imports; rank: 27)
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Relatively high cost to import a shipping container ($1,610 per container; rank: 27)
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Finance
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Rich-country investment in poorer countries can transfer technologies, upgrade management and create jobs. Conversely, policies that permit financial secrecy of companies and banks can facilitate illicit activities and financial flows abroad. The CDI rewards policies that support healthy investment in developing countries and promote transparency in financial transactions at home.
Canada’s finance performance
Strengths
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Political risk insurance agency provides wide coverage and screens potential projects for violations of human, labor and environmental rights
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Active participation and leadership in extractive industries transparency initiatives such as the Extractive Industries Transparency Initiative (EITI) and the Kimberley Process on blood diamonds
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Vigorous prosecution of home-country bribe payers
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Provides assistance to companies looking for investment opportunities in developing countries
Weaknesses
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Scores below average in the Financial Secrecy Index for having few regulations in place to prevent illicit financial transactions within its jurisdiction (rank: 17)
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Migration
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The movement of people from poor to rich countries provides unskilled immigrants with jobs, income and knowledge. This increases the flow of money sent home by migrants abroad and the transfer of skills when the migrants return.
Canada’s migration performance
Strengths
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Large number of immigrants from developing countries entering Canada (rank by share of population: 4)
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Large share of foreign students from developing countries (81.7%; rank: 5)
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Environment
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Rich countries use a disproportionate amount of scarce resources, and poor countries are most vulnerable to global warming and ecological deterioration, so the CDI measures the impact of policies on the global climate, fisheries and biodiversity.
Canada’s environment performance
Strengths
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Low tropical timber imports ($4.07 per capita equivalent: rank: 1)
Weaknesses
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High greenhouse gas emissions and fossil fuel production rate per capita (52.2 tons of carbon dioxide equivalent; rank: 25)
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Has not ratified the Kyoto Protocol on climate change
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High fossil fuel production rate per capita (29 tons of carbon dioxide equivalent; rank: 25)
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Low gas taxes ($0.34 per liter; rank: 26)
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High fishing subsidies (rank: 26)
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Poor compliance with mandatory reporting requirements under multilateral environmental agreements relating to biodiversity (rank: 24)
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Security
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Since security is a prerequisite for development, the CDI rewards contributions to internationally sanctioned peacekeeping operations and forcible humanitarian interventions, military protection of global sea lanes, and participation in international security treaties. It also penalizes arms exports to poor and undemocratic governments.
Canada’s security performance
Strengths
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Few arms exports to poor and undemocratic governments (rank by share of GDP: 7)
Weaknesses
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Has not ratified the Convention on Cluster Munitions (CCM)
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Low personnel contributions to internationally-sanctioned peacekeeping and humanitarian interventions over last decade (rank by share of GDP: 18)
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Technology
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Rich countries contribute to development through the creation and dissemination of new technologies. The CDI captures this by measuring government support for R&D and penalizing strong intellectual property rights regimes that limit the dissemination of new technologies to poor countries.
Canada’s technology performance
Strengths
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High tax subsidy rate to businesses for R&D (rank: 5)
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Restricts copyrighting of databases
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Will force patent holders to license to meet social needs
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Provides patent exceptions for research purposes
Weaknesses
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Low government expenditure on R&D (rank by share of GDP: 19)
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Imposes strict limitations on anti-circumvention technologies that can defeat encryption of copyrighted digital materials
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