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TORONTO — The federal government has announced Canada’s first sovereign wealth fund to help get major projects going, but business groups say it’s not a singular fix.
Prime Minister Mark Carney said Monday that the Canada Strong Fund will invest in areas such as energy, infrastructure, mining, agriculture and technology with an initial $25 billion in government funding.
Business groups welcomed the announcement, but emphasized that it was only part of what’s needed to get a variety of projects rolling.
“Different projects require different tools, so a sovereign fund is not going to be the answer for everything,” said Pierre Gratton, head of The Mining Association of Canada.
A state-backed investor could be quite helpful in areas like rare earth minerals, he said, because China’s control of the global market means it can change prices enough to hit producers trying to get started.
“It’s raising that capital that is so hard because it’s too risky. Now, once you’re up and running, and if you’re competitive, you can stay in business.”
For more widely produced metals like iron or copper, adjustments to the tax system and investment in infrastructure would likely do more to boost projects, said Gratton.
Matthew Holmes, head of public policy at the Canadian Chamber of Commerce, said in a statement that the fund is another tool to spur investment, but its success hinges on the details and speed of implementation.
“Such initiatives, like the Canada Infrastructure Bank, took years to set up,” said Holmes.
“So the immediate focus must remain on measures that strengthen the economy now — including internal trade, major project development, reducing red tape, AI and digital infrastructure, tax reform, and trade diversification.”
The Canada Infrastructure Bank was established in 2017 to provide lower-cost lending to help get projects going, but it has taken many years to get established.
The sovereign wealth fund will instead look for market returns, and could play a useful role in attracting more private capital, said Jordan Eizenga, infrastructure and real estate leader at Deloitte Canada.
“I do think there might be a gap in the market right now in terms of the kind of patient capital to do nation-building projects.”
He said that while the infrastructure bank took some time to narrow its focus, that looks to be less of a problem here.
“It’s pretty clear what this thing is going to be, and it feels like the prime minister has a pretty clear idea as to what he wants to do.”
The fund would also differ from Canadian pension plans because it has the dual mandate of returns and investment in Canadian projects, meaning it can be expected to take on more construction risk, and not just buy existing business operations, he said.
“We need to build things in this country, and we need to think differently about how to do that, and I think this is a very clever way to do it.”
Others, however, fear this will be another government fund that risks taxpayer money.
“What the Carney government is announcing today is essentially the Canada Infrastructure Bank under a different name,” said Emmanuelle Faubert, economist at think tank Montreal Economic Institute, in a news release.
She said if the government is to pursue such a fund, it should consider following Norway’s model that focuses on investments abroad, in part to limit the chances of political interference.
The policy institute said government-backed ventures tend to underperform private ones, and that there are better routes to spurring investment like lower taxes and regulation.
Gratton said there is a risk when government chooses projects, but sometimes it’s necessary.
“For some commodities, if government is not involved, they will never happen because of the control that China has,” he said.
“And this is geopolitical now, right? This is not just about spurring new economic activity, it’s about lessening our extreme dependence on China.”
This report by The Canadian Press was first published April 27, 2026.
Ian Bickis, The Canadian Press
