In an interview with The Globe and Mail Wednesday, Ms. Joly said the country’s auto, steel, aluminum, copper and lumber sectors are under siege from U.S. President Donald Trump’s trade war.
The government needs to aggressively respond to the Trump tariff shocks with a detailed plan to transform the Canadian economy through targeted investments, fast approvals of major projects and harnessing Ottawa’s purchasing power, she said.
“Like every single country on Earth that is affected by the decisions of the American country, we need to be able to come up with a new vision on how we will deal with our own economy,” Ms. Joly said. “It’s not a wait-and-see approach. This is a Canadian moment we need to seize.”
Ms. Joly will lay out the government’s industrial vision in a speech to the Canadian Club in Toronto on Thursday. A copy of the speech was provided to The Globe.
She said the three-point plan is a result of hundreds of conversations with corporate executives, pension fund managers, business associations and university and high-tech leaders.
In the short term, Ottawa is determined to prop up critical sectors of the Canadian economy with financial relief until these industries can adapt and pivot to new products and markets.
“We need to de-risk a lot of the sectors that are being tariffed. So in the short-term, we need to protect the market, but in the middle term we need to make sure they can pivot,” she said.
The federal government has, for example, provided $400-million to help Algoma Steel shift its production to serve the Canadian market as well as $1.25-billion to support the softwood lumber sector, which has been severely affected by rising U.S. tariffs.
Ms. Joly said Ottawa’s new industrial strategy involves using its recently announced $13-billion Build Canada Homes agency, Buy Canadian policy and the new Defence Investment Agency to drive investment and spur job creation.
Plans to purchase new submarines from either Germany or South Korea will require the winner of the contract to invest in Canada. Ottawa will be also pushing domestic companies to compete to build ships for global markets.
Canadian companies, such as General Dynamics in London and CAE in Montreal, can also count on long-term defence contracts to ensure Canadian innovation stays here, Ms. Joly said.
“For the first time in decades, we will be re-creating a military industry in our country,” she said. “Canada has one of the most important capacities in terms of shipbuilding within NATO so I want our shipyards to be able to export and sell to the world.”
Ms. Joly said Canada should be building satellites and water bombers and developing artificial-intelligence products that can be sold globally. Canada can also partner with other countries as it did with Sweden to build surveillance planes.
“We can really create good manufacturing jobs in the [defence] sector. We can create good tech jobs in that sector and we can have great researchers doing dual-use research,” Ms. Joly said.
The minister said the government intends to unveil measures to attract foreign investors and high-quality talent and researchers from the United States. The Trump administration’s harsh immigration polices are turning away highly educated foreign-born researchers at the same as time as U.S. government funding for university research is being slashed.
“We believe in science. We believe in research so our goal is to attract the best talent in the world,” she said. “Researchers around the world are looking for a stable country, a peaceful one and one that will believe in their work.”
Measures will be soon be announced involving increased funding for the Canadian Space Agency, National Research Council and for quantum research, she said.
Ms. Joly said she also plans to travel to Japan later this month to speak to auto executives. Honda and Toyota account for more than half of auto production in Canada.
The auto sector has been hit hard by Trump tariffs of 25 per cent with a carve-out for the value of the vehicle made from U.S. parts. Despite Canadian efforts to work out an auto agreement, U.S. Commerce Secretary Howard Lutnick has indicated that a trade deal will not involve the removal of tariffs on Canadian automobiles.
Ms. Joly said the recently unveiled $5-billion Strategic Response Fund will be used specifically to help workers and businesses, including the auto sector, that have been most affected by U.S. tariffs.
“We will use housing strategies and defence procurement to create demand for Canadian steel, aluminum, lumber,” she said in her speech. “We will stand with the auto sector through targeted support and the Strategic Response Fund.”
As Prime Minister Mark Carney has laid out, Ottawa will focus on oil and natural gas and the country’s abundant critical minerals to fuel industrial growth, Ms. Joly said.
She predicted that Ottawa’s new Major Projects Office that will fast-track national infrastructure projects could generate up to $60-billion of economic activity and create tens of thousands of high-paying jobs.
Ms. Joly added that the government’s Buy Canadian policy will reshape supply chains to ensure that domestic copper wiring, aluminum frames and auto parts are prioritized in federal contracts.
