Canada

At a glance

Funding trends

  • Canada is the ninth-largest donor country on the Organisation for Economic Co-operation and Development’s (OECD) Development Assistance Committee (DAC). In 2018, Canada spent US$4.7 billion on official development assistance (ODA).

  • Canada’s ODA represents 0.28% of the country’s gross national income (GNI). Projections from civil society groups indicate that Canada’s ODA as a percentage of GNI will remain below the UN target of 0.7% through FY2023/24.  

  • Budget 2019 promises an additional CAD700 million (US$540 million) in fiscal year (FY) 2023/24, but budget tables reveal that the actual increase is only CAD100 million (US$77 million) since most of this additional funding has already been accounted for in previous commitments.

3 - Canada's Total ODA

This chart depicts ODA according to the grant-equivalent measurement system. Statistics using this system became official in 2018. For further details on methodology, see our Donor Tracker Codebook.

Strategic priorities

  • Canada’s Feminist International Assistance Policy (FIAP) outlines six ‘Action areas’, with 1) ‘gender equality’ at its core. Canada applies a feminist lens to its five other priority areas, which include 2) ‘human dignity’, 3) ‘growth that works for everyone’, 4) ‘environment and climate action’, 5) ‘inclusive governance’, and 6) ‘peace and security'.
  • The FIAP stipulates that 95% of Canada’s bilateral ODA will target or integrate gender equality and the empowerment of women and girls by FY2021/22 and 50% of bilateral assistance will be spent in sub-Saharan Africa.
  • The FIAP champions sexual and reproductive health and rights (SRHR) and maternal, newborn, and child health (MNCH), a long-standing focus of Canadian development. Lesbian, gay, bisexual, transgender, queer, and two-spirit (LGBTQ2) rights are an emerging area of interest.

4* - Canada bilateral by sector

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Outlook

  • In October 2019, the Liberal Party was re-elected with a minority mandate. They have committed to maintaining Canada’s focus on gender equality and plans to develop more programs at the intersection of women’s rights and climate adaptation. The flagship FIAP will remain in place. 
  • The Liberal Party campaigned on a promise to increase Canada’s financing for international development. Priorities for the new mandate include improving the management and delivery of development assistance and education for displaced and refugee children.
  • Under the banner of ‘growth that works for everyone’, Global Affairs Canada (GAC) has an emerging focus on women’s economic leadership and empowerment. This presents opportunities to engage with the promotion of greater financial inclusion for women and equal access to capital, markets, technology, and business development services.

Policy Priorities

Canada has a Feminist International Assistance Policy; increasing emphasis on climate change and humanitarian assistance

In June 2017, Global Affairs Canada (GAC) published a new Feminist International Assistance Policy (FIAP). The FIAP seeks to “eradicate poverty and build a more peaceful, more inclusive, and more prosperous world” by promoting gender equality and empowering women and girls. The new policy applies a human rights-based approach to its core action area — gender equality and the empowerment of women and girls — as well as its five other action areas: 1) human dignity (including health education, humanitarian assistance, nutrition, sexual and reproductive health and rights, and food security), 2) inclusive economic growth, 3) environment and climate change, 4) inclusive governance, and 5) peace and security.


Canada’s key development priorities under its Feminist International Assistance Policy:

  1. Gender equality and the empowerment of women and girls,
  2. Human dignity,
  3. Inclusive economic growth,
  4. Environment and climate change,
  5. Inclusive governance, and
  6.  Peace and security.

Canada has a targeted approach to international development, channeling 92% of its spending toward five of the 17 sustainable development goals (SDGs): Gender equality (SDG5), inequality (SDG10), health (SDG3), climate (SDG13), and absolute poverty (SDG1). Canada’s regional focus is on sub-Saharan Africa with the aim of “helping the poorest and most vulnerable and supporting fragile states”. The goal is for no less than 50% of Canada’s ODA to be directed toward sub-Saharan Africa by FY2021/22. (In 2018, 25% of Canada’s ODA went to the region; see ‘ODA breakdown’ for more details.)

Canada tracks and monitors progress in the FIAP’s six action areas using key performance indicators released by GAC in February 2019. These are used alongside indicators which measure progress on the SDGs, advocacy, and in-house gender equality at GAC.

Global health, now under the banner of ‘human dignity’, is one of Canada’s key priorities. At the ‘Women Deliver’ conference that took place in Vancouver, Canada in June 2019, Prime Minister (PM) Trudeau announced that his government would increase its support for women’s and girl’s health around the world from CAD1.1 billion (US$849 million) to CAD1.4 billion (US$ 1.1 billion) dollars annually by 2023. He committed to maintain that yearly investment until 2030. Half of the promised financing will be allocated for sexual and reproductive rights and health rights.

The government has prioritized women and girls in violent conflict as well; the budget for FY2018/19 included CAD20 million (US$15 million) over five years to bring refugee women and girls from conflict zones around the world safely to Canada.

LGBTQ2 rights are another emerging focus of Canada’s emphasis on human dignity and inclusive economic growth. In February 2019, Canada announced CAD30 million (US$23 million) in funding over the next five years dedicated to advance human rights and improve socio-economic outcomes for LGBTQ2 people around the world.

LGBTQ2 rights are an emerging focus.

Under PM Trudeau, Canada has championed the application of a gender lens to climate change. The Canadian government led the first-ever Gender Action Plan under the United Nations Framework Convention on Climate Change, adopted by countries at COP23 (the UN Climate Change Conference) in Bonn in 2017. Canada also hosted a summit of women climate leaders during its 2018 Group of Seven (G7) presidency. In August 2019, the government also announced a CAD300 million (USD$231 million) contribution to the Green Climate Fund, which invests in climate-resilient development projects.

In late 2018, FinDev Canada, Canada’s development finance institution (see ‘Main actors’) signed an agreement with the African Development Bank to collaborate on climate action, gender equality, and women’s economic empowerment, suggesting that future investments could be expected in these areas in Africa. Increasing collaboration on innovative financing with initiatives such as FinDev, the International Assistance Innovation Program, the Sovereign Loans Program, and the Equality Fund, and ensuring that their activities are aligned with the values of the FIAP, are stated priorities for the new Minister of International Development outlined in the Mandate Letter they received from the PM in late 2019.

In light of the COVID-19 pandemic, Canada announced CAD50 million (US$39 million) in funding to support low-income countries dealing with the health emergency. The funding is intended to help "respond to the needs of vulnerable populations", including women and girls. It will fund efforts to prevent the spread of COVID-19 and to provide essential services.

ODA Breakdown

Canada favors the use of earmarked funding channeled through multilaterals

Canada’s core funding to multilaterals stood at US$1.1 billion, or 24% of gross ODA disbursements in 2018, significantly below the DAC average (41%). An additional US$1.3 billion, or 28% of Canada’s ODA, was channeled through multilateral organizations as earmarked funding for a specific issue or country. (This is reported as bilateral ODA.) Canada’s use of multilateral organizations within its bilateral programs is higher than the DAC average of 14%.

Bilateral funding represented US$2.3 billion or 48% of Canada’s ODA, in line with the DAC average of 45%. Canada channels most of its bilateral funding through the public sector (US$1.1 billion), followed by NGOs and civil society (US$935 million).

5 - Canada bi-multi ODA

For further details on methodology, see our Donor Tracker Codebook.

 

In 2018, Canada gave almost all (93%) of its bilateral ODA as grants (DAC average: 91%). Canada considers this an effective way to deliver increasing amounts of ODA while reducing administrative burden.

Canada is placing increasing emphasis on innovative finance. In 2018, CAD1.5 billion (US$1.2 billion) was allocated to two new measures over five years, starting in FY2018/19: the International Assistance Innovation Program (CAD873 million, or US$674 million) and the Sovereign Loans Program (CAD627 million, or US$484 million). These will complement Canada’s core development activities by leveraging the use of guarantees, equity, and repayable contributions, with additional authority for innovative finance granted to Global Affairs Canada (GAC) (see ‘Main Actors’). The government expects to double its international assistance provided through innovative tools between 2018 to 2022, with the aim of making Canada a leader in ‘blended financing’ for development assistance.

Canada wants to be a leader in ‘blended financing’ for development assistance.

Bilateral spending focuses on humanitarian assistance

Humanitarian assistance received the largest share of bilateral ODA in 2018 (US$661 million or 19% of all bilateral ODA). This is in line with Canada’s increasing focus on international peace and security, as well as human dignity in humanitarian crises. Under the Feminist International Assistance Policy (FIAP), Canada emphasizes gender-responsive humanitarian action; 90% or US$597 million of Canada’s humanitarian spending in 2018 included gender equality as a principal or significant objective.

Health and populations received the second-largest share of bilateral ODA (US$566 million, or 16% of total bilateral spending in 2018). This aligns with Canada’s demonstrated leadership in the areas of maternal, newborn, and child health (MNCH), sexual and reproductive health and rights (SRHR), and global health at large.

In-country refugee costs rose again in 2018 to US$506 million (14% of bilateral spending). According to the UNHCR’s annual report, Canada admitted more resettled refugees (28,100) than any other country in 2018.

4 - Canada bilateral by sector

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Sub-Saharan Africa receives the largest share of Canada’s ODA; funding to Bangladesh saw the largest growth in 2018

Canada’s FIAP emphasizes the poorest and most vulnerable. As such, the greatest share of Canada’s bilateral ODA in 2018 went to low-income countries (27% or US$966 million), while middle-income countries received 27% of funding. This approach, allows Canada to support sustainable development through 1) more effective engagement with fragile states and countries in crisis, 2) stronger partnerships for sustainable development, and 3) productive partnerships for transition while maintaining the ability to provide targeted and shorter-term assistance to a range of countries and regions.

6 - Canada bilateral ODA income group

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The FIAP dictates that by FY2021/22, at least 50% of Canada’s bilateral ODA will be directed to sub-Saharan African countries, however, in 2018 just 25% of Canada’s ODA went to the region (DAC average of 21%).

Excluding unallocated funding, the Middle East and North Africa (MENA) was the region to receive the second-largest share of Canada’s bilateral ODA (US$440 million). This was driven by flows to Afghanistan (US$127 million) and Syria (US$109 million), Canada’s top two recipient countries overall. This is consistent with Canada’s new multi-year commitments to the region and its emerging interest in the nexus of peace, security, humanitarian, and development assistance.

Canada’s bilateral ODA to Bangladesh increased more than funding to any other recipient country between 2017 and 2018, making Bangladesh the fourth largest recipient of Canadian development funds. ODA to Bangladesh increased 124%, from US$40 million in 2017 to US$89 million in 2018. This increase could be linked to Canada’s role in role in responding to the Rohingya crisis, since more than one million Rohingya refugees have arrived in Bangladesh since August 2017.

7 - Canada top 10 recipients

For further details on methodology, see our Donor Tracker Codebook.

Canada uses grants to minimize the administrative burden of increasing ODA.

Canada’s multilateral spending concentrates on the World Bank, UN agencies, and the Global Fund

In 2018, Canada’s top multilateral recipients were the World Bank’s International Development Association (US$341 million, or 30% of multilateral ODA), followed by UN agencies (US$220 million, or 19%) and the Global Fund to Fight AIDS, Tuberculosis and Malaria (US$202 million, or 18%). Canada has furthermore pledged CAD930 million (US$699million) for 2020-2022 as part of the Global Fund’s sixth replenishment conference in October 2019. Gavi, the Vaccine Alliance also received significant funding from Canada (US$77 million) for the third year in a row. Since 2002 Canada has invested more than CAD1.0 billion (US$772 million) through Gavi, which has a new replenishment coming up in June 2020.

While Canada continues to favor the use of earmarked funding to multilaterals within its bilateral programs, a 2018 OECD Development Co-operation Peer Review recommended that Canada provide more unearmarked funding to multilateral institutions.

Unless otherwise indicated, all data in this section is based on the cash-flow basis measurement system. For more information, see our Donor Tracker Codebook.

Main Actors

PM provides strategic direction; GAC drives development policy

Prime Minister (PM) Trudeau (Liberal Party, L) sets high-level development policy priorities. Under the PM’s leadership, Global Affairs Canada (GAC), the governmental department in charge of foreign affairs, steers development policy. GAC comprises three formerly separate departments and thus falls under the leadership of three ministers: The Minister of Foreign Affairs, the Minister of International Development, and the Minister of International Trade

GAC is headed by the Minister of Foreign Affairs, François-Phillipe Champagne (L). The Minister of International Development, Karina Gould (L) sets development policy and makes funding recommendations to the Cabinet. The Deputy Minister of International Development, Leslie MacLean (L), manages GAC’s development policy units and budget allocation.

At a country and regional level, GAC’s geographic branches set the agenda for managing existing programs and allocating funding. Canada’s embassies provide input on project development and assist in monitoring projects. Under PM Trudeau, ambassadors and high commissioners (or consulars where relevant) enjoy a certain degree of autonomy. However, major projects usually require approval by the Office of the Minister of International Development, who can approve programs up to CAD20 million (US$15 million) at their own discretion. Programs with a budget beyond this limit require approval from the Cabinet’s Treasury Board.

The Minister of Small Business, export promotion, and international trade, Mary Ng (L), works with the Ministers of Finance and International Development on development finance issues. The Department of Finance, headed by Bill Morneau (L), manages core contributions to — and Canada’s relations with — the World Bank, in consultation with GAC.

The 2018 International Financial Assistance Act grants either the Minister of Foreign Affairs or the Minister for International Development the authority to take repayments and re-appropriate profits from sovereign loans, innovative financing mechanisms, and climate change programs — a function previously not available to ministers in the department.

 

CANADA'S DEVELOPMENT COOPERATION SYSTEM

Canada Organisation Chart
  • Parliament: Canada's Parliament is composed of the House of Commons, the Senate, and the Monarch of the United Kingdom (represented by the Governor General). Within the House of Commons, Standing Committees review government policies in specific areas. The Standing Committee on Foreign Affairs and International Development (FAAE) supervises the operations and management of GAC. During parliamentary debate of the budget, the FAAE holds hearings with the Minister of International Development. The House of Common’s Standing Committee on Finance (FINA) is responsible for budgetary policy, including Canada’s development assistance. Given their minority mandate, the Liberal Party must cooperate with other political parties in parliament.
  • Civil Society: Civil society organizations (CSOs) can submit suggestions on the annual budget and are occasionally consulted in the run-up to major foreign policy decisions (i.e., the Feminist International Foreign Policy). The Development and Humanitarian Assistance Civil Society Partnership Policy (2016) outlines the guiding principles and objectives underlying the government’s engagement with CSOs in alleviating poverty and delivering humanitarian assistance. GAC convenes CSO representatives annually to discuss the implementation of this policy.

Beyond these key actors, there are important fora in which development discussions and policy decision-making occur. The International Development Research Centre(IDRC) is mandated to support research, tools, and leadership to address development problems. The government appoints the board, which along with the Centre Management Committee, guides the direction of the center.

Export Development Canada (EDC), Canada’s state-owned export credit agency, is mandated to support trade between Canada and other countries and to promote Canada's international competitiveness. However, because of the COVID-19 outbreak, EDC has been granted domestic powers for the first time. Until December 31, 2021, EDC's focus will shift away from international trade and toward domestic efforts to support Canadian businesses facing financial challenges as a result of the global response to COVID-19.

In 2018, the Canadian government created FinDev Canada, a development finance institution capitalized with CAD300 million (US$231 million) . FinDev Canada is a wholly-owned subsidiary of EDC and aims to be financially sustainable, generating returns on loans and investments while producing favorable economic and social impacts in the communities where its clients operate.

Because of COVID-19, EDC has been granted domestic powers for the first time.

Budget Structure

IAE is the primary ODA budget tool; new funding being raised through innovative tools

The main budgetary tool that funds development assistance in Canada is the International Assistance Envelope (IAE). Generally, the IAE accounts for around 86% of Canada's overall international assistance and on average, around 96% the country's total international assistance is ODA-eligible. The IAE has grown in recent years. For example, Budget 2018 added CAD2.0 billion (US$1.5 billion) incrementally over five years. However, Budget 2019 outlined a much more modest increase of only CAD100 million in FY2023/24 (see ‘ODA trends’).

Overview: Budget FY2019/20

millions
CAD

millions
US$

International Assistance Envelope (IAE) 5,747 4,434
Core Development 3,439 2,653
Humanitarian Assistance 788 608
International Financial Institutions 777 599
Peace & Security 407 314
Crisis Pool 200 154
Strategic Priorities Fund 136 105

Source: Budget 2019 – Investing in the Middle Class

The IAE accounts for around 86% of Canada's overall international assistance and around 96% the country's total international assistance is ODA-eligible.

According to Budget 2019, in FY2019/20 Canada’s IAE will be CAD5.7 billion (US$4.4 billion). CAD3.4 billion (US$2.7 billion) or 60% will be dedicated to supporting Canada’s core development programs. Other key areas of funding are humanitarian assistance (CAD788 million [US$608 million], 14%) and international financial institutions (CAD777 million [US$599 million], 14%), which includes core contributions to the International Development Association (IDA).

In FY2017/18 (the latest year for which government budget data is available), GAC managed the largest share of Canada’s ODA (71% or CAD4.1 billion [US$3.2 billion]). The Department of Finance, the second largest disburser of ODA (9% or 536 million [US$413 million]), mainly manages Canada’s relationship with the World Bank Group and is responsible for delivering official debt relief. Canada’s International Development Research Centre (IDRC) managed 3% of funding, and 2% was picked up by FinDev Canada.

ODA associated with supporting refugees during their first year in Canada are managed jointly by Immigration, Refugees, and Citizenship Canada (IRCC) and provincial governments. These costs accounted for 11% or CAD656 million (US$506 million) of Canada’s ODA.

The 2019 budget announced the creation of a new report on Canada’s international assistance for 2018-2019, which for the first time will reconcile 2018-2019 IAE allocations presented in the 2018 budget with actual 2018-2019 IAE expenditures.

Budget Process

Fiscal year runs from April to March

Canada Budget Circle

 

Canada’s fiscal year runs from April 1 to March 31. Key stages in Canada’s budget process include:

  • Central agencies work with departments to develop budget strategies: In June, the Cabinet reviews the budget. From June to September, central agencies — Privy Council Office, Department of Finance, and Treasury Board Secretariat (TBS) — work with government departments to incorporate the results of the Cabinet review and develop budget proposals for the Finance Minister. By September, all departments send budget letters to the Finance Minister, which include requests for budgetary changes.
  • Pre-budget consultation process begins, including public outreach and parliamentary consultations with external stakeholders: From June to August, the Department of Finance invites civil society organizations (CSOs) and other stakeholders to submit suggestions on the budget, including on development. The pre-budget consultation process provides direct opportunities to advocate for issues around the overall ODA file.
  • Minister of Finance consults with Parliament: Between October and December, the Minister of Finance releases Budget Consultation Papers and begins consultation with the House of Commons’ Standing Committees. Participants from within government, as well as other experts, are invited to give testimony on policy areas and budget lines. Results of the consultation process and recommendations of the committees are considered by the Finance Minister. The Department of Finance launches its annual consultation on ODA, as required under the Official Development Assistance Accountability Act. While not part of the official budget consultation, this is a critical opportunity to advocate for increases for overall ODA or specific initiatives.
  • Fall Fiscal Update and Public Accounts of Canada are released: Around November, the Department of Finance tables its Fall Fiscal Update and Public Accounts. These provide an update of projections since the previous budget. Around this time the House of Commons’ Finance and Foreign Affairs Committees hold consultations. These may provide direct opportunities to advocate for development issues, especially during the discussion of the Public Accounts, when the status of the execution of the previous year’s budgets are released.
  • Finance Minister develops budget strategy, Cabinet reviews it; Prime Minister and Finance Minister make final decisions: In early December, the Minister of Finance develops a budget strategy with input from the ‘Memoranda to the Cabinet’ from all departments. It outlines policy priorities and financial asks. The Cabinet reviews these and budget proposals from December to January. The Prime Minister and the Finance Minister may make final adjustments until February/March.
  • ‘Main Estimates’ are tabled; Finance Minister delivers budget speech; budget is approved: The budget is usually presented to the House of Commons in February/March in a speech by the Finance Minister. The Main Estimates, which are the detailed spending plans for each department for the upcoming financial year, will be tabled by the president of TBS no later than April 16 in 2019. However, there will be areas of surplus not included in the Main Estimates, as the government will look to maintain a ‘surprise’ factor around highly political areas, including development spending.