Aid |
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
- Large amount of private charitable giving attributable to tax policy (rank by share of GDP: 3)
- Prevents project proliferation; large average project size (rank: 4)
Weaknesses
- Moderately low net aid volume as a share of the economy (0.33%; rank: 14)
- Significant share of aid to less poor and worse-governed recipients (selectivity rank: 11)
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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.
Canada’s trade performance
Strengths
- Low tariffs on non-agricultural commodities (2.5% of the value of imports; rank: 2)
- Low tariffs on sugar (3.6% of the value of imports; rank: 3
Weaknesses
- High tariffs on most agricultural commodities (19% of the value of imports; rank: 23)
- Low level of manufactures imports from poorer countries (9.4% of GDP per capita; rank: 23)
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Investment
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Rich-country investment in poorer countries can transfer technologies, upgrade management and create jobs. The CDI includes a checklist of policies that support healthy investment in developing countries.
Canada’s investment performance
Strengths
- Employs tax-sparing arrangements to prevent double taxation of corporate profits earned abroad
- Particularly active in Extractive Industries Transparency Initiative (EITI) and the Kimberley Process on blood diamonds
Weaknesses
- Political risk insurance given to inefficient, import-substituting projects
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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 home.
Canada’s migration performance
Strengths
- Large share of foreign students from developing countries (85%; rank: 4)
- Large number of immigrants from developing countries entering Canada (rank by share of population: 4)
- Bears large share of the burden of refugees during humanitarian crises (rank: 5)
Weaknesses
- Tuition for foreign students higher than for nationals
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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
- Low tropical timber imports ($4.31 per capita; rank: 1)
Weaknesses
- Low gas taxes ($0.32 per liter; rank: 26)
- High fishing subsidies ($8.50 per person; rank: 26)
- High greenhouse gas emissions and fossil fuel production rate per capita (50.9 tons of carbon dioxide equivalent; rank: 25)
- Poor compliance with mandatory reporting requirements under multilateral environmental
agreements relating to biodiversity (rank: 23)
- Has withdrawn from the Kyoto Protocol
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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, rewards military protection of global sea lanes, and penalizes arms exports to poor and undemocratic governments.
Canada’s security performance
Strengths
- Few arms exports to poor and undemocratic governments (rank by share of GDP: 7)
Weaknesses
- Small financial and personnel contributions to internationally sanctioned peacekeeping and humanitarian interventions over last decade (rank by share of GDP: 17)
- Has not ratified the Convention on Cluster Munitions (CCM)
- Few resources committed to protect global sea lanes
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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
- High tax subsidy rate to businesses for R&D (rank: 5)
- No attempt to incorporate into bilateral free trade agreements “TRIPS-Plus” measures that would restrict the flow of innovations to developing countries
- Does not offer patent-like proprietary rights to developers of data compilations, including those assembled from data in the public domain
Weaknesses
- Low government expenditure on R&D (rank by share of GDP: 20)
- Large share of government R&D expenditure on defense (rank by share of GDP: 19)
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