Turning Perception into Reality: Canada in Africa

Perceptions of Canada’s engagement and influence in Africa are very much disconnected from reality. Canada’s image as a humane internationalist country deeply engaged with Africa relies on an idealized version of history, where we have provided steadfast support to the continent through aid, development assistance, and peacekeeping.  At various times throughout Canadian foreign policy, the reality of our engagement with Africa has been much closer to that ideal than it is now. Today, the gap is arguably wider than ever: Canada maintains only 15 foreign missions in Africa, and these are charged with covering 54 countries; we have dramatically reduced the number of states we assist with poverty reduction; and we have shifted, seemingly, to prioritizing NATO armed intervention in places like Libya over UN peace-building efforts in Mali or Sudan. Finally, no one could mistake our preference for looking to the ‘East’ when it comes to investment and political engagement rather than to the ‘global South’, indeed, at present we appear to be looking everywhere but Africa as we design and implement our foreign policy agenda.

The reality of Canada’s engagement with Africa is disappointing – particularly as it does not position us well to be part of the continent’s current renaissance. While much of Africa is still burdened by crushing underdevelopment and poverty, the Gross Domestic Product (GDP) of the continent as a whole is reported to have grown by 6.6% in 2012.  Growth is projected to continue at this rate for the foreseeable future. African states are actively seeking out foreign direct investment in order to tap into natural resources, build infrastructure, and create jobs, securing the continent’s place as a major stage for rapid economic growth. Politically, many African states are stabilizing and enjoying greater influence in international affairs as result, especially within global governance institutions.

The closer one looks at Africa’s geopolitical position today, the more difficult it is to justify Canada’s disconnect from the continent.

That the public’s perception of Canada’s engagement with Africa has yet to catch up with reality is impressive given that Canada has never actually maintained a consistent or sustained engagement strategy. This is mainly because much of our engagement has been the product of short-term individual initiatives guided by individual foreign policy entrepreneurs such as Lloyd Axworthy, Jean Chrétien, Paul Martin, Stephen Lewis and Roméo Dallaire. Further, Canada’s engagement on the continent has been focused on particular niche areas like human security and thereby defined primarily by our aid and peacekeeping activities, which have shrunk significantly in recent decades. While we have a legacy that is worth being proud of, we cannot boast of sustained engagement leading to net gains.   

There is no good reason, however, why we cannot engage in such a way as to make perceptions match up with reality. Certainly one must avoid mistakenly engaging with ‘Africa’ as a single and homogenous unit. But one can develop a whole-of-continent strategy in conjunction with region-specific strategies. We seem to have concluded, however, that the latter alone is sufficient, and that we are present where we ought to be. But Africa as a continent is far more dynamic and interconnected that our current approach presumes. Thus, we must expand our reach by offering an overarching, cohesive vision.

With the wheels of the next federal election beginning to turn, now is the time to demand something more than ad-hoc, short term, piecemeal initiatives from our government. Canadian academics, policymakers, and civil society members need to step up and stir up a nation-wide debate over how to advance African development, build capacity, reduce poverty, and achieve our national interests all at the same time. This is not an unrealistic goal, indeed, such thinking has informed our approaches to engaging with Latin America, Europe, and Asia…so why not Africa?

In looking to Canada’s relationship with the continent, three things are immediately apparent. Firstly, Canada’s strategy for engaging with African states has been inconsistent, often contradictory, and that’s hurting us, or at least denying us valuable opportunities.  Secondly, we wish to be part of Africa’s renaissance and starting seizing the diverse opportunities on offer, we must provide a coherent vision and a range of tailored strategies. Thirdly, Canada already has some important tools needed to do this, and where we don’t, we need to commit to acquiring them. 

To drive home these points, I will tackle three different issue areas, starting with the economic, followed by the developmental and the personal.  While these are certainly not the only areas that one could consider when analyzing Canada’s relationship with the continent, they are a great point from which to launch into a broader conversation about the ties that bind us, and how to further strengthen Canada-Africa relations to our mutual benefit.

Mission Possible: Improving Canada-Africa Trade and Investment

Africa is a site of enormous economic potential but Canada is only a minor trading and investment partner – our involvement pales in comparison to that of other countries.  Canadian entrepreneurs have been reticent to engage with the African continent due to perceived risks associated with doing business here.  Concerns over inflation, access to a skilled labour market, infrastructure, political instability, corruption, and conflict are all often cited.  Moreover, since much of the population still lives in impoverished contexts with little ability to consume imports, many Canadian producers wonder what’s the point of running all those risks if there’s little chance of worthwhile returns?

Such view neglects that in a number of places in Africa, a middle class is emerging that is educated, skilled, and keen to join the ranks of global consumers. Governments also appear to be improving their ability to address and rectify the issues responsible for the risks listed above; many are actively seeking to improve the conditions for foreign direct investment (FDI) and trade by undertaking economic reforms and trying to stem systemic challenges like corruption.  Malawi, Benin, and Rwanda are just a few examples of where real improvements have been made. The efforts seem to be working as the OECD’s African Economic Outlook for 2013 paints a mainly positive picture for the prospect of economic growth on the continent. Indeed, FDI to Africa hit a $50 billion high and exports from Africa grew to over $581 billion in value in 2012.

That the environment for investment is improving is also evidenced by the fact that competition for the African market has been heating up.  In general, OECD countries have been losing market share to non-OECD countries, particularly Brazil, India, and China in terms of trade.  However, Canada is the only OECD country to buck that trend and actually grow its share of the African goods trade since 2005.  This is good news in terms of there being a foundation on which we can build, but the real numbers are in fact quite small, placing Canada low on the partner priority list amongst African states.

The Canada-Africa trade relationship currently sits at $15 billion per year. And here, Canada as a market for African goods ($12 billion) far outweighs Africa as a market for Canadian goods ($3 billion).  Whilst figures have been steadily improving, it still amounts to little when one thinks of it in comparison to other Canadian trade relationships and other trade partners for Africa.  For example, Canada’s yearly goods trade with Africa is equivalent to 2 weeks of Canada-U.S. trade.  On the continent, this number is eclipsed by the US, EU, and China.  Indeed, in 2009 Canada-Africa goods trade accounted for 1.4% of Africa’s market whilst the EU accounted for 36.8%, the U.S. 12.7%, and China 13.5%.  

Whilst Africa as a trade hub is still quite small, sitting at approximately a 3% share of global activities, it is growing steadily and, more importantly, holds huge opportunity, according to the WTO ( 2012, p 32 table I.13). Certainly, an ability to grow the share of trade will require improving upon a number of the problems mentioned, particularly the availability of infrastructure to efficiently move goods around and from the continent. But, as it stands, there are three regional hubs already anchoring increased cross-continental and overseas trade – Nigeria, South Africa, and Kenya.  These three countries currently serve as a launch pad for much of Africa’s trade and investment as they maintain good infrastructure, logistics capacity, access to financial capital, and house a number of corporate headquarters or regional offices.  South Africa is the most advanced in these respects. Spokes are now emerging from these three hubs, particularly in terms of port traffic, in places such as Tanzania, Mozambique, Angola, Namibia, and the Democratic Republic of Congo (DRC) (Draper and Scholvin, p.15-18).  In addition, one assumes that as Libya and Egypt stabilize they will also return to being important players in African trade and investment.

In terms of leading trade partners for Canada, Algeria, Nigeria, Angola, South Africa and Egypt are in the top five.  Top commodities that are traded with Africa are agricultural products like wheat, aviation, and motor vehicle parts, and extractive materials like gold, crude oil, uranium and sulfur, which by and large reflects the industries that are driving Africa’s growth: expanded agricultural production, services, oil production, and mining.  This would suggest our trade relationship has strong potential for growth, as these are all areas in which Canada maintains real competency and financial capital for investment.

However, the lack of Canadian political representation on the continent encumbers government efforts to promote trade.  While we maintain a number of trade commissioner offices across the continent that work to advance the interests of Canadian business, these tend to be small and cover large geographic regions.  We lead relatively few trade missions to African states and have yet to conclude a free trade agreement with a single African country.  Prior to the recent trade mission to Nigeria and Ghana (which Minister Fast had to cut short because of pressing EU negotiations) we had not had a trade mission on the continent since 2008.  The Governor General did a tour of Ghana, Botswana, and South Africa in May of 2013 but these visits were more to reaffirm ties rather than to press forward on any negotiations or conclude any deals. 

It is difficult to gauge just how severely the lack of official representation, visits and missions has impacted Canada-Africa trade relationship. We know that it takes political focus and often times pressure to improve trade ties.  In much of Africa there has been neither and the results are clear. Sub-Saharan Africa is the most obvious example, receiving the smallest share of Canadian exports – just 0.4% – of all that we trade. Low numbers such as this are not likely to change without Canadian political representatives pushing trade links and countering misinformation about the investment environment. And on this front, we do see some movement: Export Development Canada is exploring the idea of setting up a $500m credit facility for business to promote exports between Canada and South Africa.

On the investment side, Canada is an important player in foreign markets.  In 2012 Canadian corporations invested $711 billion abroad, a figure that is up from 2011.  According to the North-South Institute, Canadian foreign direct investment mainly went to the United States (41%) but other markets including Europe and Central Asia (27%), Latin America (20%) and East Asia (8%) are growing in terms of destinations for Canadian interest.

The developing world, which includes much of Africa, accounts for a very small portion of Canadian FDI.  Indeed, in 2011 only $13.5 billion out of the $684 billion went to countries with a status of developing or least developed.  While Canadian investment in these types of states has grown on average 5% since 2001, broadly speaking, Canada continues to be a minor player in much of Africa’s economic invigoration. 

That said, for the apparent lack of interest in negotiating trade agreements with African countries, the Canadian government has been particularly active in establishing Foreign Investment Protection Agreements (FIPAs) with African nations such as Zambia, Cameroon, Nigeria, Egypt, Benin, Cote D’Ivoire, Madagascar, Mali, Senegal, and Tanzania.  Currently, negotiations are underway with Burkina Faso, Ghana, Guinea, and Tunisia.  South Africa holds a Trade and Investment Cooperation Arrangement after rejecting a FIPA with Canada because it was not sufficiently suitable to South African interests.

FIPAs are negotiated bilaterally between the two capitals and are held up as an important prerequisite for Canadian investors.  But despite South Africa rejecting the Canadian FIPA, it is still the site of the most Canadian investment on the continent, coming in at just over $3 billion in 2012. This counterpoint suggests that FIPAs are not always required.  Indeed, I remain skeptical of their value given the dearth of information available assessing their effectiveness. The Canadian Government has also been active in the past encouraging investment to Africa with the $212 million Canada Investment Fund for Africa.  The fund was meant to make private equity investments in businesses but was wrapped up in 2008 and has not been renewed. 

Despite the small portion of Canadian FDI taking place, Canadian companies are considered some of the larger investors present in some African states.  For example in Madagascar, the Ambatovy Mine project, in which Canadian Sherritt International is one of the largest shareholders, is one of the biggest economic projects going in that country at the moment.

But Canadian FDI in Africa is narrowly focused in the extractive industries sector with Canadian mining houses largely taking the lead in Canadian entrepreneurial engagement. Natural Resources Canada notes that in 2010, Zambia, Mauritania, South Africa, Madagascar, the Democratic Republic of the Congo, Ghana, Tanzania, Mali, Senegal, and Eritrea were the sites for the largest amount of Canadian mining assets.  African operations are the second largest site of Canadian foreign mining investment behind Latin America but only account for 14% of the sectors overall activity.  According to the North-South Institute, Canadian mining companies earned approximately $13 billion in profits in 2012. 

Growing the investment relationship could be helpful in bringing about a closer political relationship. Mechanisms for this could include growing the role for the Canadian extractive sector and/or encouraging other enterprises to take advantage of the opportunities that exist on the continent. It seems bizarre that Canadian financial institutions, particularly insurance companies, banks, and other service-based industries are not taking greater steps toward taking advantage of Africa’s economic growth, despite the FIPAs, positive projected growth figures, and stated needs. 

If Canada wishes to be a larger player on the African continent and in its development, it will have to broaden the scope of its economic engagement. The extractives sector and related industries are sustaining our engagement for the moment, but if we are to improve our ties with African states, we must break new ground. This will require strategic and forward thinking support from the Canadian Government and business together, rather than a predominantly industry-led approach.

An Aid Relationship to be Proud of

Canada is the 9th largest provider of Official Development Assistance (ODA) on the African continent. Holding this position is certainly a positive indicator, especially given Canada’s relative size to others, but it hides an uncomfortable truth about our historically inconsistent role in continental development. Indeed, Canadian aid to the region has been far from stable over time and appears to have been driven primarily by activist prime ministers keen to leave an international legacy. Jean Chrétien and Paul Martin both reinvigorated Canadian aid to Africa in 2003, but prior to that, Canada’s commitment had been declining since the early 1990’s.

In comparative terms, Canadian ODA to Africa has always been relatively small in comparison to other G7 partners; Canadian aid as a portion of G7 aid to Africa has normally come in at around 4%.  However, in 2007, that portion jumped to 7% as other G7 partners cut back and we increased our allotment. Indeed, if we consider aid to the region since 1990, Canadian ODA to Africa followed G7 declining trends until 2003 when we started to outpace our G7 partners in terms of proportional increases.  This is the moment when the Chrétien Government established the Canada Fund for Africa and took a leadership position amongst G7 partners.  To his credit, Prime Minister Harper has seemingly kept up with Canada’s provision of aid to Africa despite his apparent skepticism regarding its value and necessity.

Indeed, in 2011 the Canadian Government provided every African country with some degree of developmental assistance with the exception of 3 countries – Algeria, Seychelles, and St. Helena.  This speaks to a remarkable turn around in terms of Canada’s developmental presence on the continent in just over 10 years. Today, African states make up over half of the top 20 recipients of Canadian ODA, and Canada gives approximately $1.5 billion to Africa out of its $5 billion total aid budget.  Not a small portion and a clear indication that Africa is still a continent in need. 

Since the government’s decision to focus its aid provision on priority countries, the lion share of Canada’s African ODA, $1.2bn, goes to Ethiopia, Tanzania, Mozambique, Ghana, Mali, Sudan, Senegal, DRC, Nigeria and Kenya, and Burkina Faso. The effectiveness of Canadian aid in these and other states is difficult to ascertain; ODA comes in many different forms, ranging from food aid to humanitarian assistance, institution capacity building, and support for civil society, and criteria for measuring effectiveness remain hotly debated within the development community. One can safely say that there are many excellent Canadian organizations doing good work here. And yet we should not underestimate the extent of the development challenges that remain: little has changed in terms of poverty levels on the continent according to a recent Afrobarometer report; safe and secure access to clean water, medicines, and basic foodstuffs continues to be a real issue despite the decades-long efforts of Canada and other donor nations.  In terms of countries with the highest levels of poverty, Burundi, Guinea, Niger, Senegal and Togo sit at the top the list. Frustratingly, countries such as Botswana, Mali, South Africa, and Tanzania – hailed in the past for making real developmental gains – are seeing some of these trends reversing.

Despite Canada’s focused attention in Senegal, Mali, and Tanzania, things are reported not to have improved markedly.  Understanding why will be crucial to understanding how to more effectively disburse our ODA in the future. In particular, we really need to interrogate this idea of “focusing aid” and ask for what purpose and to what outcome.  Focused aid does not necessarily result in effectiveness nor does it mean that our strategies are smart. Aiding effectively or smartly is something we must strive to do better at if we are to cement lasting partnerships with African states. Nothing is worse for a relationship then when expectations are left unfulfilled.  Such moments can result in long lasting damage and hinder efforts to build ties and fulfill our mutual interests.

Many are now discussing the future of Canada’s foreign aid and development assistance programs, including the conversation recently launched on CIC pages. The issue of tying aid provision to Canadian commercial interests is generating significant attention as it suggests that the Canadian government is moving beyond a concentration on poverty reduction.  Canadian approaches to aid, particularly under the Harper government, have focused more on short-term initiatives and accountability than on a longer term vision of how aid can best help Africa.  As Stephen Brown argues in his recent chapter in Canada Among Nations 2013, ODA in Africa often requires cooperating with other donors and recipient countries to determine how best to achieve development.  This requires a long-term vision that encompasses the full slate of development issues, which is sorely lacking. (Brown, 2013: 190).

Such a lack of vision in part speaks to the fact that the Canadian government has never undertaken a review of its aid programing in Africa to determine what has worked and what has not, in a ‘big picture’ way. (Brown, 2013: 189).  Instead, Canadian aid has been shaped, reshaped, revised, and refashioned differently depending on the wishes and desires of the Prime Minister.  And, as it currently stands, we have a Prime Minister who is not overly interested in Africa.

In this context, it is perhaps not all that surprising that many are worried about the ‘commercialization’ of Canadian aid. Public-private partnerships with Canadian commercial interests are an interesting idea but one that should be scrutinized more closely to ensure that we do not end up with aid as a de facto subsidy for Canadian enterprise abroad. We cannot afford an aid policy that simply reinforces engagement driven by economic entrepreneurialism rather than a more holistic development agenda.

As Canadians, we normally hold up our country’s development commitments, particularly in Africa, as part of our moral identity (see Akuffo, 2012). There are many great stories of Canadian sponsored development, and of individual Canadians doing good and impactful work on the continent.  But the truth is, these efforts have resulted in little traction in building effective bonds with the continent more broadly as they have been short term and ad-hoc. If conducted with greater coherence of vision, our aid activities could do much to clarify what kind of relationship we seek with Africa.

MAPPING CANADA’S RELATIONSHIP WITH AFRICA

The People Pillar: Canada-Africa Migration

The African-Canadian community is the fastest growing ethnic minority in Canada. In 2001, it was the third largest minority group behind Chinese and South Asian populations.  In 2012, the top ten sources of immigration from Africa to Canada were Egypt, Morocco, Algeria, Nigeria, Cameroon, Ethiopia, Tunisia, South Africa, DRC, and Somalia.  In total, Canada accepted 33,988 immigrants from 48 African states, a number that has been growing and accounts for 13% of the 257,887 immigrants who arrived in Canada in 2012. Immigrants from Africa primarily choose to settle in Manitoba, Quebec, and Ontario.

This is a glaring gap. The African Diaspora in Canada is uniquely positioned to influence both their home and host governments.  As Carmant, Nilolko, and Douhaibi (2013: 61) argue in their recent chapter in Canada-Africa Relations: Looking Back, Looking Ahead “[diasporas] can exert pressure on their home government from abroad, free from political threats and fear of retribution, and they can lobby their host country to put pressure on their home government to enact policies favourable to their interests, ranging from calls for human rights progress and government reform to constructive international trade policies.”

Africa’s Diaspora, like any, carries the interests of its homeland with it, maintains active connections and links through business ties and remittances, and possesses deep knowledge of politics throughout the continent.  Members of the Diaspora also have deep and valuable understandings of their home markets, which could be leveraged to help reduce the time it takes for Canadian businesses to gain access. In Canada, many African ex-pats seek to influence political processes through bloc voting, lobbying, or by advancing their interests through a Member of Parliament. 

Carmant, Nilolko, and Douhaibi (2013: 69-70) note that the Somali community in Canada is deeply engaged in Somali affairs, sending remittances, providing humanitarian assistance, and participating in reconstruction efforts.  Active in politics, they have advanced their interests effectively during municipal elections in Ontario and have set up community organizations that seek to promote peace and stability back in Somalia. As such, the Somali-Canadian community is an influential force that the government could approach for assistance in building bridges between the two countries.[1]

On the flip side, the lack of engagement that characterizes the government’s approach to the diaspora within Canada also appears to be true when it comes to connecting with Canadians living in Africa.  Despite the fact that there appears to be a dearth of information regarding the number of Canadians living in Africa, I can attest that we are in fact here.  What has been remarkable since my arrival in South Africa and travels around the continent is how little the Canadian diaspora is actually drawn upon by the government to help advance Canada’s foreign policy agenda.  As an anecdote, I was celebrating the German national day a few years ago at their embassy and came across a diplomat from the Canadian High Commission.  I enquired if the High Commission held a similarly large celebration for Canada Day and invited local Canadians…my question was met with a very clear response: unfortunately the High Commission not tasked with hosting Canada Day celebrations nor is engaging with the Canadian diaspora part of our foreign policy agenda.  Such a comment left me dumbfounded as the Canadian diaspora holds enormous soft power that could be exercised to the government’s advantage through the social and professional networks we establish.  As such, there needs to be serious consideration given to how the African diaspora in Canada can be mobilized in support of advancing our influence on the continent.

The idea of diaspora engagement as an element of Canadian foreign policy towards Africa has not been fully realized, which is bizarre given that Canada is a nation of immigrants; 1 in 5 Canadians are born in another country and Canada has the 5th largest immigrant community as a proportion of our population, according to the Diaspora Nation Report.  Canada is within the top 10 countries for preferred immigrant destinations and actively seeks to attract skilled professionals to fill gaps in our labour market needs. Diaspora groups often become influential constituencies within the Canadian political system.  More importantly, diaspora groups provide important knowledge and links that can be integral to building stronger bonds between countries and regions.  As such, it seems only logical that if Canada wishes to engage more effectively and efficiently with Africa, that it utilize a resource that is easily available, accessible, and interested in helping.

Turning Perception into Reality: Towards an Effective Engagement Strategy

Canada is present across Africa but the scope of our relationship is narrow, our priorities and methods for achieving them inconsistent. There appears to be little coherence between our economic, developmental or personal relationships.  This results in Canada’s presence being spread thin, giving the appearance of an ad-hoc engagement which ultimately affects our ability to build linkages with the region in a sustained way.

Economic entrepreneurs and private industry today are guiding most of our efforts, and there is a notable lack of high-level political interest in the continent. Fewer foreign missions translates into fewer opportunities to co-operate with nations that appreciate being recognized and engaged with via diplomatic channels.  Indeed, just last year the outgoing dean of the African diplomatic corps in Ottawa said it best: “For us Africans, trade, diplomacy, and policy go together…” This all means that political engagement is integral to building meaningful relationships with African partners and has direct implications on economic outcomes.

While we are among the top 10 donors to Africa, the small size of our contribution in relation to the need, the inconsistency with which our assistance is provided, and the lack of understanding of its effectiveness, has arguably hindered closer links with African partners who care deeply about how development issues are approached in their states. 

Migration between our two regions is robust and there are many diaspora communities that could act as a bridge by sharing knowledge and links, but these groups are little considered or engaged.  This only hurts Canadian foreign policy in Africa.

So, where do we go from here? Beyond some of the more practical elements like improving our diplomatic representation on the continent and diversifying our economic engagement, we need a strategy that is anchored by values and principles.  And here  – principles like consistency, non-paternal partnership, regionalism, and sustained engagement could be helpful, especially alongside values like mutual benefit, poverty alleviation, and good governance.  Indeed, these principles and values could allow us to strike a balance between our long-standing humane internationalist sensibilities and the more realist foreign policy our government espouses at the moment.

We need an approach that is sensitive to the regional dynamics of the continent, especially in terms of accounting for nodes of economic influence such as Nigeria, Kenya, and South Africa. At the same time, we need to decide what we can offer to conflict resolution, peace building, and counterterrorism efforts like those required in Mali, Libya, and Sudan. We would be wise to recognize where our strengths lie, to look beyond the hard power aspects of Canadian foreign policy and step in with more soft power type initiatives such as education links, NGO and civil society engagement, and diaspora mobilization.

Now is the time explore what our African Engagement Strategy could and should look like. However, while I firmly believe we need an engagement strategy, the foundation I have laid here – three bonding pillars, the economic, the development, and the human – is only one possibility, offered in the hopes that it will spark counter-proposals and more specific policy recommendations. Do we need to reinvigorate the human security agenda and emphasize our role as peacekeepers on the continent?  Should we step back and let Canadian firms show us how to engage with Africa?

A wider public debate over our approach to Africa is in order. That is what will create an opportunity for Canada to turn its supposedly deep and unwavering commitment to the continent into reality.

1. Not all diaspora groups in Canada are overly enamored with their former homes of course; the South African-Canadian community is a notable example of a group that identifies with its homeland but does not maintain further links through remittances, business or other charity support (see Crush, 2013). Jonathan Crush notes that reasons for this speak to a general disaffection that some South African’s feel in the post-apartheid era, stemming from the perception that the system is still not geared toward equal opportunity for all.