The road from Monterrey: a caution from Canada

Armine Yalnizyan

The International Conference on Financing for Development in Monterrey represents a historic moment: the first time the United Nations will sit with the IMF, the World Bank, and the WTO to negotiate common cause. Which vision will dominate? The UN’s, which defines where we should go, but not how to get there from here? Or the IMF-World Bank-WTO, who tell us what road to take, but not what to do when we get there? Canada, having followed to the letter the IMF-World Bank-WTO road map strongly warns against it.

What follows is a cautionary message from a nation that has followed, to the letter, the steps that are now being proposed as the agenda for Financing for Development. Yet creating a favourable business climate and watching the economy grow at rates not seen in over a generation has not been enough to prevent the continued deterioration of public goods. Canadian society is moving further away from, not closer to, the vision of the Universal Declaration of Human Rights, even as national wealth increases. The following traces the steps that Canadian governments have taken, the same steps that are being urged for all at the Monterrey talks. The results here should raise questions about the wisdom of adopting this agenda globally.

Create a favourable business climate

Reduce the size of government

Increase confidence with lower inflation, lower costs of borrowing money

Increase reliance on trade

Attract more foreign investment

These four steps are the heart of the model that will be featured at the Monterrey talks. Promoting “policy convergence” means convergence towards trade liberalisation and privatisation, ostensibly for the benefit of all. In the immediate, these policies require rolling back gains in social development for the least powerful under the guise of better things to come down the road.

The result of implementing these politically difficult policy changes has been improvement in the “economic fundamentals”, ie, lower interest rates and less inflation. Though these conditions have contributed to a rapidly growing economy, other economic benefits, such as lower unemployment rates and higher incomes, have been slower to follow. This model of growth has distinctively different impacts on the economy and on people.  

Results for the Canadian economy

The economy grew

Record budgetary surpluses at the federal level

Federal debt decreased

Deep tax cuts

Results for the people of Canada

Creating a hospitable environment for business investment and reducing the size of government has resulted in fewer mechanisms to ensure that the benefits of growth would translate to all citizens.

Inequality grew

More hunger

Unsafe drinking water

Access to quality public education and health care declining


Canada’s experience shows that though economic growth may promise a better quality of life, the means can overtake the ends. The objectives of the Universal Declaration of Human Rights, once seemingly easy to secure in affluent countries like Canada, are becoming increasingly distant for a growing number of citizens.    

It is ironic that more Canadians enjoyed greater human rights when the economy was much smaller. The reason was the active will and intervention of governments that saw their purpose as insuring a “framework of fundamental fairness and decency within which all Canadians are able to pursue their individual goals”.[19]  This stands in sharp contrast to the reductionist goal of insuring the right “economic fundamentals”.    

The federal government has followed the advice now being presented to developing countries to the letter, and has been praised by the institutions that created the game plan. The Monterrey agenda reinforces this plan globally, a plan that believes the private sector can secure the public good. 

But the bottom line is that there are certain things the private sector cannot do.  The role of the public sector in keeping an entire nation healthy and educated is irreplaceable. The private sector can no more deliver these public goods to all members of society than it can deliver a justice system, or the defence of a nation. 

The outcome of the Monterrey talks will set the stage for what help people can expect from their governments in their struggle for a better life. Concerned citizens everywhere need to reinforce the importance and legitimacy of public investments in the most basic areas of human life. When people are adequately fed and housed, healthy and educated, economic growth naturally follows. The notion that basic human needs will be met only when economic “basics” have been properly aligned is a perverse logic that is unfortunately being promoted globally. 

Canada’s experience should serve as a caution for those who take the road from Monterrey following the IMF/World Bank/WTO road map. It is a route that takes us further away, not closer to, the destination we set out for ourselves more than 50 years ago: the objectives set out in the 1948 Universal Declaration of Human Rights. It is time to carve out an alternate route, a more direct route, a route that puts the attainment of human basics first.   


[1] Government of Canada, Department of Finance, Fiscal Reference Tables, September 2001, Table 54.

[2] Ibid. Table 8. These fiscal years are both peaks of the business cycle, so the contraction is not due simply to the strengthening of the economy.

[3] Department of Finance Canada, A Report on Plans and Priorities, 2001-02 Estimates, p. 11.

[4] Statistics Canada, Consumer Price Index, CANSIM P200000. Note that the Government used the War Measures Act on 18 October 1941, during World War II, to set limits on wages and prices. The measures came off in 1945, when the war ended, and prices grew at an annual average of 7% until 1952.

[5] All figures from Industry Canada, Departmental Performance Report 2000-2001, 31 March 2001, Section 2.4.  Available on-line at:

[7] Industry Canada, Micro-Economic Policy Analysis Branch, The Trade and Investment Monitor, Fall/Winter 1999/2000, pp. 24-26.

[8] Statistics Canada, National Accounts, Gross Domestic Product, Expenditure-Based, CANSIM 14840, CANSIM 100126.

[9] Armine Yalnizyan, What would they do with the surplus? Ottawa: Canadian Centre for Policy Alternatives, November 2000, pp. iv and 6.

[10] Government of Canada, Department of Finance, Annual Financial Report of the Government of Canada, Fiscal Year 2000-01, p. 5.

[11] Statistics Canada, The Daily, 6 November 2001, “Family Income”.

[12] Livio Di Matteo, “Middle Class Gains the Most from Redistribution of Wealthy Line”, National Post, 28 August 2001, p. C15.

[13] Federation of Canadian Municipalities, A National Affordable Housing Strategy, Ottawa: 11 October 2000.

[14] Federation of Canadian Municipalities, A Better Quality of Life Through Sustainable Community Development: Priorities and Investment Plan, Federal Budget Submission to Finance Minister Paul Martin, 15 April 2001, p. 22.

[15] Carly Steinman, “A Surplus of Hunger: Canada’s Annual Survey of Emergency Food Programmes”,  prepared for the Canadian Association of Food Banks, October 2000.

[16] Daily Bread Food Bank, Who’s Hungry Now: Food Recipient Profiles, 1995 to 2001, Toronto: 2001.

[17] Federation of Canadian Municipalities, 2001, p. 22.

[18] A CAD 21 billion programme multi-year re-injection of federal funds is scheduled to bring it back to that level over the next four years. See details at 

[19] Liberal Party of Canada, Creating Opportunity: The Liberal Plan for Canada, Ottawa: 1993, p. 73.

Armine Yalnizyan is Research Associate of the Canadian Centre for Policy Alternatives.