Investing.com — Canada is launching a sweeping overhaul of its defence procurement system, aiming to replace a complex and sluggish acquisition model with a streamlined and centralized agency tasked with equipping the military in a more strategic and timely manner. Prime Minister Mark Carney announced the creation of the Defence Investment Agency, which will manage more than $60 billion in upcoming investments, position domestic industries for global competitiveness, and fulfill rising international defence obligations.
The reform comes amid mounting global instability and concerns over Canada’s military readiness, with critics long highlighting procurement delays that leave the Canadian Armed Forces reliant on outdated or insufficient equipment. In recent years, key defence projects have taken decades to reach completion, prompting the government to promise faster acquisition cycles and greater industry engagement.
“In a dangerous and divided world, Canada’s new government is ensuring the Canadian Armed Forces get the equipment they need, when they need it,” Mr. Carney said during the announcement. “The new agency will bolster our defence industrial capacity, create new careers, and ensure that in this new era, Canada’s leadership is not defined by the strength of our values, but also by the value of our strength.”
The Defence Investment Agency will centralize procurement activity previously dispersed across multiple departments, with specialized staff focusing exclusively on military acquisitions. In addition to trimming bureaucratic layers, the agency is mandated to integrate earlier consultation between industry and armed forces, aligning procurement timelines more closely with operational needs.
The agency’s creation also signals a broader industrial strategy, using procurement to stimulate domestic production in aerospace, shipbuilding, and advanced manufacturing. The government says that by ensuring contracts are tied to Canadian economic benefit, the initiative will help grow small and mid-sized enterprises while meeting NATO’s 2% GDP military spending threshold. Investments will also support NATO’s 5% Defence Investment Pledge benchmark by 2035.
Doug Guzman, formerly Deputy Chair of the Royal Bank of Canada, was appointed CEO of the new agency. “This is a tremendous opportunity for partnership between government and businesses,” Mr. Guzman said. “All at once, we can drive investment, strengthen our national security, and meet our international commitments.”
International alignment is another stated priority, with the agency designed to facilitate greater interoperability with close partners such as the United Kingdom, France, and Australia. Officials say the model will also support Canada’s participation in the EU Readiness 2030 initiative, which is coordinating allied investments in supply chains and defence infrastructure.
The agency will begin operations this year under the oversight of Secretary of State (Defence Procurement) Stephen Fuhr, with a first wave of high-priority projects expected to be launched by mid-2025. The Canadian defence industry, which contributes nearly $10 billion to GDP and supports over 81,000 jobs, is expected to play a central role in delivering the new government’s ambitious military modernization agenda.
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