In 2000 at the United Nations Millennium Summit, Canada joined 189 world governments in the commitment to achieve the MDGs, a set of 8 goals aimed at improving the lives of the world’s poorest by 2015.

The Target

• Develop further an open, rule-based, predictable, non-discriminatory trading and financial system (includes a commitment to good governance, development, and poverty reduction – both nationally and internationally).

• Address the special needs of the Least Developed Countries (includes tariff and quota free access for Least Developed Countries' exports, enhanced program of debt relief for heavily indebted poor countries [HIPC] and cancellation of official bilateral debt, and more generous official development assistance for countries committed to poverty reduction).

The Facts

$100 billion minimum is needed per year to meet the goals, or 0.5% of the gross national income of the Development Assistance Committee countries. Total official aid is less than half of this. Unless rich countries keep their pledges to deliver financing for development, the Millennium Development Goals will not be met.

More aid alone is not enough. It also has to be more effective. Aid should not be tied, should be harmonized with local development priorities and should have its administration reduced as far as possible. New approaches to debt relief are needed, particularly in the face of collapsing produce markets. Current trade policies are highly discriminatory. For example, agricultural subsidies in rich countries lead to unfair competition, crippling developing countries’ markets.

The average OECD tariff on manufactured goods from developing countries is four times those on goods from other OECD countries. There is significant scope to improve poor people’s access to global technologies. For example, only 10% of global spending on medical research is directed at diseases of the poorest 90% of the world.

The Opportunity

Honouring commitments to increase aid is especially important during a time of economic crisis. As the economic crisis is hurting developing countries particularly hard, developed countries must not use the crisis as an excuse to not meet their aid obligations.

A sustainable financing resources for development should include:

• A global Financial Transaction Tax, a very small tax of 0.05% on all financial market transactions which could raise hundreds of billions of dollars to help low countries achieve the MDGs and deal with the impacts of climate change.

• A commitment that puts an end to secrecy in tax havens

• Fighting fiscal evasion to increase the resources of developing countries, obliging multinational companies to be accountable for their investment and the taxes they should pay in each country where they are located.

Our Focus

Canada should develop a detailed plan outlining how it will achieve the promised 0.7% target within ten years. It should also consider other alternative financing mechanisms such as Financial Transaction Tax and press for actions on regulating tax havens and stopping tax evasion by multinational corporations.