The missing piece in Canada’s defence industrial strategy

As published on LinkedIn

After more than a decade of drift, the federal government is finally moving with the urgency needed to equip the Canadian Armed Forces for a more dangerous world.

But let’s not kid ourselves: this won’t come cheap. Defence spending is projected to soar past $200 billion a year by 2035 – a staggering sum that will strain public finances and test Canadians’ willingness to pay.

Indeed, Canada’s weak defence record is no accident. Unlike NATO allies long accustomed to living under the shadow of direct threats, we lack a deeply ingrained security culture. Where others intuitively understand the value of military investment, Canadians too often remain unconvinced of its importance.

For us, the case must be made differently – in economic terms. That means showing Canadians how defence dollars will deliver real and tangible benefits to their daily lives: high-paying jobs, modern infrastructure, and homegrown innovation.

The Carney government seems to understand this. Which is why it has placed a new defence industrial strategy at the centre of its military rebuild – framing record defence spending as a once-in-a-generation opportunity to strengthen not just our security, but our economy, too.

For that promise to hold, however, the strategy must rest on two pillars. The first is promotion: ensuring Canadian industry can both capitalize on, and reliably deliver, the advanced capabilities our military needs.

Here, the government appears on the right track. A key element of the strategy will be a robust “Buy Canadian” policy, prioritizing domestic manufacturers in defence procurement, supported by new measures like R&D funding and export promotion.

But the second pillar – protection – is missing.

The economic gains the government seeks will only materialize if Canada safeguards its defence industrial base as vigorously as it promotes it. If adversaries can steal our technology, disrupt our supply chains, or sabotage our critical infrastructure, the strategy will fail – leaving us weaker militarily and poorer economically, all while squandering billions of taxpayer dollars in the process.

Our allies have already learned this lesson. As Europe has rearmed, Russian intelligence operations aimed at undermining those investments have quadrupled.

Attacks range from disabling Swedish telecom towers and severing Baltic undersea cables, to planting bombs on British cargo planes and even attempts to assassinate German industrial leaders.

Europe’s response has been decisive: pairing industrial protection with promotion to harden their economies against attack.

Canada’s has not. And that leaves us dangerously exposed.

To fill this institutional gap, the government must embed protection at the core of its strategy. Three steps are essential:

• First, the Prime Minister should direct the intelligence community to create a formal threat-sharing exchange with industry, so companies know what they are up against and how to respond.
• Second, government and industry should launch a joint training program to give industry security leaders first-hand insights into government protocols during an attack, strengthening trust and mutual understanding.
• Third, to better coordinate public and private sector responses, Parliament should legislate safe-harbour protections to enable companies to voluntarily share security information with each other and government without fear of liability.

Our allies’ experience offers a stark warning: a defence industrial strategy that promotes without protecting is destined to fail. Only by doing both can the government deliver on its promise – ensuring Canadians’ hard-earned dollars buy not just security, but lasting prosperity.