Canada Launches C$25bn Sovereign Wealth Fund to Boost Economy

Canada is launching a government-owned investment fund to pay for major development projects in the country, Prime Minister Mark Carney has announced. The Canada Strong Fund, a first for the country, will invest in energy, infrastructure, mining, agriculture and technology, with an initial contribution of C$25bn ($18.4bn; £13.5bn). The fund will also allow Canadians who have "a bit of extra money" to invest into it directly, but experts have warned it risks "limited returns". The move is part of a broader goal by the Carney government to boost Canada's economy in face of US tariff threats. At Monday's announcement in Ottawa, Carney said that Canada was at a critical point in its history due to its changing relationship with the US, requiring it to invest and build at an urgent pace. "The US has changed, that's their right," he said. "And we are responding, that's our imperative." The prime minister said the fund will invest - along with the private sector - into what his government has described as "nation-building projects" like port upgrades and natural resource development. "Many countries that are blessed with natural resources like Norway have sovereign wealth funds. Canada hasn't had one, until now," the prime minister said. The Montreal Economic Institute warned in a statement on Monday that the fund "risks costing taxpayers dearly while generating limited returns". Leader Pierre Poilievre labelled it a "sovereign debt fund", noting that the country's finances were in a deficit. "Norway, Singapore and Saudi Arabia run big budget surpluses which they accumulate and put into their sovereign wealth funds," Poilievre said. "Carney has no surplus, and therefore no wealth to put in such a fund." The Conservative leader also questioned why Carney wants to put public funds into major infrastructure projects. "If a project has a business case, why would the government need to fund it?" Poilievre asked. On Monday, Carney said that Canada's financial position had improved and that the deficit was lower than what his government had anticipated, allowing for the creation of the Canada Strong Fund. He added that foreign investment in Canada had increased and "is outpacing all other major economies right now". The government has said it will hold consultations over the coming months on the details of the fund. Carney on Monday credited other countries for having "the foresight many decades ago" to launch their own sovereign wealth funds. Among them is Norway, which launched a fund in 1990 that invests the surplus revenues of its oil and gas sector exclusively outside the country. That fund has grown to $2.1tn in assets, according to a 2025 Bloomberg report, becoming "the largest of its kind". Like Norway, Canada sits on a rich bed of natural resources, including the third-largest oil reserves in the world. But unlike Norway, Canada is in debt, meaning its sovereign wealth fund will not be paid for by revenues but rather borrowed money, says Joseph Steinberg, an economics professor at the University of Toronto. "Historically, sovereign wealth funds are vehicles for countries that generate a lot of income from publicly-owned assets, and this is almost always oil wealth," Steinberg told the BBC, adding that income is then invested in a diverse portfolio, often outside of the country. In Canada's case, Steinberg said it appears the money will be mostly used to invest in domestic projects instead.