EDC's new disclosure policy keeps loan figures out of report:

Spokesman blames 'misunderstanding' for exclusion of annual numbers

by Jack Aubry,

The Ottawa Citizen Thursday,

September 6, 2001 Page A7

The secretive Export Development Corporation is using its development of a supposedly improved disclosure policy as its excuse to withhold the usual annual release of basic figures on its loans to other countries.

The EDC, along with the Canadian Wheat Board, the Canadian International Development Agency and the Finance Department, have released each year in June a breakdown of their loans and the money owed them by other countries, which total more than $30 billion.

But this year the Finance Department delayed the release of the list for several months while waiting for the EDC's permission toreveal its debt figures. Finally, the department released a list on Aug. 21 with only the 2000–2001 figures for itself, CIDA and the Wheat Board, leaving the EDC completely off the list for the first time in four years.

Jean–Michel Catta, a Finance Department spokesman, confirmed that the EDC withheld the release of the loan figures on the grounds that it could not do so while working out a new disclosure policy.

"They said they were reviewing their policy and they wanted to be sure that whatever was released conformed to the new policy," said Mr. Catta.

He did not know whether the EDC's new disclosure policy would be more restrictive or more transparent, than the previous one.


Rod Giles, a spokesman for the EDC, said the exclusion of the EDC from the list this year was due to a "misunderstanding" with the Finance Department. "Our view is that it can be released, providing it meets the guiding principles set forward in our proposed disclosure policy with respect to aggregate reporting and so long as the confidentiality of customers is protected," said Mr. Giles.


But he said he could not say whether the release of the information would meet the guiding principles because he hadn't seen them. He acknowledged the new disclosure policy played a role in the EDC's exclusion from the list this year: "In the sense that it created hesitation perhaps on the part of some people."

Pamela Foster, the spokeswoman for the NGO Working Group on the Export Development Corporation, said the EDC's latest move is frustrating for those looking for the Crown corporation to become more transparent and accountable to the Canadian public.

"EDC is using its draft disclosure policy as an excuse to deny the public access to information. It is outrageous that the public is placed in a position where people have to beg EDC for basic information," said Ms. Foster.

The Finance Department started making the lists available after Finance Minister Paul Martin promised during a meeting with non–governmental organizations (NGOs) in 1998 to make the country–by–country breakdown public.

The working group, which wants to monitor EDC loans to make sure they are financing environmentally and socially responsible projects, is pushing for the EDC to be placed under the Access to Information Act and to take responsibility for loans that are uncollectible.

"The debt owed to EDC from the poorest countries will be written off as part of international efforts for debt cancellation. Currently, the EDC will be reimbursed directly from taxpayers for these losses, keeping its net profits and loan loss reserves," said Ms. Foster.

In the 1999-2000 list provided last year, the EDC was responsible for two-thirds of the $30–billion owed to Canada by foreign countries. China was easily the largest country in debt to Canada on the list, with a total of about $2.4 billion in loans from the EDC.

This year's partial list, entitled Canada's Exposure to Foreign Countries, as of March 31, 2001, provides a list of 97 countries and the money owed by each to Canada. The largest exposure provided on the partial list is $3.1 billion to Poland, followed by $2.4 billion to Russia, both through the Canadian Wheat Board.


EDC officials had said the corporation's new disclosure policy will address recent criticisms from the media and NGOs that they are unaccountable.

Patrick Lavelle, the chairman of the EDC board, vowed recently to finalize a new disclosure policy for the EDC that would make it more accountable to the public. He acknowledged a "culture of secrecy" in government bureaucracies and a mindset in Crown corporations that information is power and its release will just generate unwarranted criticism.

The disclosure policy will be finalized this fall.