Canada's Industrial Landscape: The Triple Engine of Energy, Critical Minerals, and AI Infrastructure

Event: Canada's Economy Enters a Period of Structural Differentiated Growth

In 2025, Canada's real GDP grew by 1.6% on an industry basis. While the pace is not staggering, multiple sectors have demonstrated strong resilience. According to Statistics Canada, mining, quarrying, oil and gas extraction, as well as manufacturing, were the main drivers of growth during the month. The growth is not randomly distributed but concentrated in areas where Canada holds enduring structural advantages: natural resources, advanced manufacturing capabilities, digital infrastructure, high-value exports, and a relatively stable regulatory environment. From artificial intelligence to agri-food, these industries are defining the next phase of Canada's economy.

Why It Happened: Structural Advantages and Policy Jointly Driving

Canada's economic growth does not rely on a single industry but on an industrial cluster woven from multiple advantages. The energy sector remains the core of investment: energy capital expenditures in 2025 reached CAD 89 billion, including CAD 42 billion for oil and gas extraction and CAD 34 billion for electricity generation and distribution. There are 205 planned large-scale energy projects with a total investment of CAD 378 billion; 113 projects under construction have a total investment of CAD 132 billion. LNG Canada shipped its first cargo in 2025, marking the realization of Canada's natural gas export potential, with capacity expected to reach approximately 19 million tonnes per year by 2030.

Critical minerals and the electric vehicle battery supply chain are another clear growth theme. Canada ranks second globally in the lithium-ion battery supply chain, with 160 zero-emission vehicle supply chain companies and 3.4 million STEM graduates. Volkswagen's/PowerCo's CAD 7 billion gigafactory in Ontario is expected to produce batteries sufficient for 1 million electric vehicles annually. On the policy front, in March 2026, Natural Resources Canada announced up to CAD 165.2 million for 22 projects, potentially leveraging CAD 434 million in critical mineral activities. Previously in 2025, 26 investment and partnership plans were announced, expected to unlock CAD 6.4 billion in critical mineral projects.

AI and digital infrastructure are also accelerating. Canada's ICT sector contributed CAD 131.6 billion to GDP in 2024, with revenues of CAD 298 billion, employment of 803,000, corporate R&D spending of CAD 15 billion, and an average annual salary of CAD 103,460. The federal government launched a CAD 2 billion sovereign AI computing strategy, and in April 2026, initiated a national AI supercomputing infrastructure tender. Microsoft's AI infrastructure expansion in Ontario will support 1,250 jobs.

The aerospace sector has emerged from the pandemic recovery period, contributing CAD 34.2 billion to GDP in 2024, supporting 225,000 jobs, with direct employment recovering to 99.8% of pre-pandemic levels. Canada ranks among the top four globally in civil flight simulators, aircraft, and engines, with R&D spending higher than any other domestic manufacturing sector.Agri-food and seafood continue to contribute to exports: In 2025, wheat production hit a record 40 million tonnes, and canola reached 21.8 million tonnes, up 11.2% and 13.3% respectively. Seafood is exported to 114 countries, with lobster valued at CAD 3 billion, making it the most valuable seafood export category.

Regulated online gambling is expanding rapidly in Ontario: In the 2024–25 fiscal year, regulated operators recorded CAD 82.7 billion in bets and CAD 2.9 billion in gaming revenue, up over 30% year-on-year. Online casinos are the most popular product category, with the market continuing to grow amid intensified competition and a strict regulatory framework.

What this means for Canadian industries: A shift from resource endowment to technology-driven transformation

These industries together outline the transformation path of Canada's economy. Traditional energy remains the cornerstone, but clean energy, critical minerals, and AI infrastructure are becoming new growth poles. Canada is no longer just an exporter of raw materials; through policy guidance and capital investment, it is combining natural resource advantages with digital technologies to build a more complex industrial ecosystem. For example, critical minerals not only supply raw materials for EV batteries but also drive the entire chain of processing, manufacturing, and R&D. AI infrastructure investment positions Canada in the global computing power race. The R&D intensity and global competitiveness of the aerospace industry show that Canada still has strength in high-value-added manufacturing.

What this means for global technology competition: Critical minerals and computing power become strategic assets

Globally, countries are competing for critical mineral supply chains and AI computing infrastructure. Canada is one of the few countries with both abundant mineral resources and low electricity prices, coupled with a stable political environment and a STEM talent pool, making it a popular destination for battery and AI infrastructure investment. LNG projects and critical mineral deployments also align with global energy transition and supply chain diversification needs. In the AI field, the sovereign AI computing strategy aims to reduce reliance on overseas computing power while providing affordable computing resources for SMEs, aligning with AI infrastructure trends in other countries.

Potential changes in the next 3–10 years: Industrial upgrading and reshaping global role

In the short term, energy investment will continue, but critical mineral projects will accelerate into production, further consolidating Canada's position in the global EV supply chain. AI infrastructure investment will generate more AI applications and R&D centers, potentially leading to the emergence of a new generation of technology companies. The aerospace industry will benefit from global fleet aging and maintenance demand, with stable growth. Agri-food exports benefit from global food security needs but must face climate change risks. The rapid growth of online gambling will trigger discussions on stricter regulation.

In the long term, Canada needs to address labor shortages and productivity challenges. However, if it can consistently convert resource revenues into technology investment, Canada has the potential to transition from a resource economy to a knowledge economy, becoming a key hub for global critical minerals, clean energy, and AI computing power.

Long-term trend: Canada's transition from "resource output" to "technology empowerment"What truly deserves attention is not the growth rate of any single industry, but the systemic transformation of Canada’s economic structure. The three major sectors—energy, critical minerals, and AI infrastructure—are converging: minerals provide materials for technological hardware, AI enhances the efficiency of resource extraction, and clean energy powers data centers. This synergy means that Canada is no longer just a supplier of global resources, but is becoming a participant in technological solutions. The strategic significance of Canada’s tech industry in the future lies in whether it can leverage its natural resource advantages into technological sovereignty in the digital era.

*This article is based on a collaborative report with The Jerusalem Post, with data sourced from official institutions such as Statistics Canada, Natural Resources Canada, and Innovation, Science and Economic Development Canada.*