The Liberal government introduces comprehensive reforms to bolster Canada’s domestic defence sector, aiming to reduce dependence on U.S. military equipment. The new defence-industrial strategy emphasizes self-reliance amid global uncertainties.
Core Objectives and Arctic Sovereignty
The strategy highlights the need for Canada to maintain its own defence capabilities. ‘In this uncertain world, it is more important than ever that Canada possess the capacity to sustain its own defence and safeguard its own sovereignty,’ the document states. ‘This is especially important when it comes to protecting Canada’s Arctic sovereignty and promoting a secure North.’
Prime Minister Mark Carney delayed the announcement last week following a mass shooting in British Columbia, shifting the release to later this week. Details from the $6.6-billion plan focus on enabling small and medium-sized businesses to enter the defence market and prioritizing Canadian-made equipment over foreign suppliers.
Job Growth and Economic Benefits
Officials project the initiative will create 125,000 jobs over the next decade. Canada’s defence industry currently supports over 81,000 positions, according to recent government data.
The plan restructures the industrial and technological benefits policy for contract awards, favoring partnerships with reliable Canadian firms. These partners gain access to research funding, export support, financing, and testing facilities. ‘They will be expected to deliver capability on time and on budget and support national sovereignty through their Canadian supply chains, while also ensuring continued value for money,’ the strategy notes.
Procurement and Export Targets
Defence contracts awarded to Canadian companies will rise from about 50% to 70% of total acquisitions, strengthening sectors affected by U.S. tariffs. The government targets a 50% increase in defence exports and more than 240% growth in industry revenues.
Preferences prioritize building equipment domestically, followed by allied production and then foreign purchases. Key areas include aerospace, drones, ammunition, and sensors.
NATO Commitments and Global Partnerships
This aligns with accelerated defence spending to meet NATO targets. The strategy calls for reliable northern infrastructure and greater autonomy amid shifting alliances and potential imperial threats.
Canada reaffirms its strong U.S. defence ties while addressing Russia’s actions in Ukraine. Expanded collaboration targets the European Union, United Kingdom, Australia, New Zealand, Japan, and South Korea through more trade commissioners and military trade fairs.
‘The rise of new powers, increasing protectionism, and shifting dynamics in international relations have also underlined the necessity of thinking differently about the intersection of Canadian sovereignty, defence needs, and economic development,’ the document explains.
