Opinion: Carney’s defence industrial strategy is a huge step forward, but there are vulnerabilities that must be patched up

Prime Minister Mark Carney before a Liberal caucus meeting on Parliament Hill, on Feb. 24. Photo by Blair Gable/Postmedia files

Article content

Ottawa’s recently published Defence Industrial Strategy (DIS) is one of the most significant developments in the Canadian defence ecosystem in decades. As is true in any ambitious undertaking, the promulgation of the plan is just the beginning.

Article content

In summary, the government has laid out an ambitious agenda to invest $6.6 billion over the next decade in a series of initiatives intended to bolster our domestic industrial capacity in several key areas, reduce our dependence on foreign suppliers for military equipment, stimulate domestic job growth and fundamentally transform the mechanisms by which Canada acquires and sustains military capabilities. Ultimately, the aim is to more efficiently and productively mobilize nearly $500 billion in planned spending toward equipment, preparedness, infrastructure and downstream capacities.

Article content

Article content

Article content

The DIS identifies ten priority sovereign capabilities central to Canada’s growth and long-term resilience, ranging from aerospace and ammunition to sensors, space and critical minerals. This list also includes several areas where Canada already demonstrates capacity, competence and export potential such as shipbuilding, communications, space, aerospace and autonomous systems. The goal being to grow those sectors to not only satisfy our own needs but to potentially scale up as competitive exporters of Canadian competence and capabilities.

Article content

Article content

I will add to the chorus of support as I genuinely believe this is an essential, unprecedented and long-overdue expression of national ambition and intent. No such strategy has existed in recent memory, and our defence industrial capacity has suffered from decades of incoherence and neglect. Born out of the historical necessity and urgency of our current geo-strategic circumstances, the DIS is a major step in the right direction.

Article content

This is the start-point for what will no doubt be a decades-long effort to not only rebuild our Armed Forces, but to build much needed autonomy, resilience and opportunity into critical sectors of our economy. I don’t envy Doug Guzman and his nascent team at the Defence Investment Agency as their “to-do list” rapidly outpaces their current capacity. This is going to be hard work and any expectation of miracles in the near-term is unrealistic.

Article content

Article content

The government has however set a wide range of explicit targets. My instinct is that many of these are “stretch goals” and as such we should try not to be overly focused on, or distracted by, the specifics of the numbers and the associated timelines despite the overwhelming compulsion to do so. There will be mistakes, and potentially some failures. The inherent risks of such a complex undertaking are massive; so too are the potential rewards. The lesser alternatives would be to continue to bumble our way forward by way of the status quo ante, or to take a more cautious path toward incremental change. Neither of these would meet the compelling needs of the current strategic context.

Article content

Article content

From a strictly economic perspective, there are some who will argue the inherent inefficiency of using public funds in a “Keynesian” strategy to artificially stimulate an industrial sector that might not otherwise survive on its own. This argument is flawed for a couple of reasons. First, given the critical need to rebuild the Armed Forces and meet our alliance commitments, the money must be spent anyway. This key principle underlies PM Carney’s central maxim: Why would we spend these funds elsewhere if we can spend more of them at home? Secondly, many of the core capabilities identified as priority investment areas are vital to our national interests and will not magically materialize without serious public investment. Therefore, keeping our cake while we eat it makes sense in this context; it’s simply smart policy.