Canada and the U.S. Don’t Need to Rethink Defense Cooperation, They Need to Reinforce It

By Laura Dawson, April 2026

At a moment of heightened global uncertainty, Canada and the United States are asking an important question: how do we ensure that North America can produce the defense capabilities it needs: quickly, reliably, and at scale?

Last week in Toronto, I had the opportunity to convene a small group of business leaders, innovators, and policymakers for a candid discussion with U.S. Ambassador to Canada Pete Hoekstra, joined by Ontario’s Minister of Economic Development, Job Creation and Trade, Vic Fedeli. The conversation focused on defense manufacturing and technology, but what emerged was something broader: a reminder that the Canada-U.S. relationship is not something we need to rebuild, it is something we need to strengthen.

For generations, Canada and the United States have operated what is, in effect, a shared defense industrial base. Through institutions like NORAD and agreements such as the Defense Production Sharing Agreement, our two countries have developed a level of interoperability that is rare among allies. Canadian firms help build U.S. defense systems, and American companies invest, manufacture, and innovate in Canada. Products move back and forth across the border multiple times before they are complete.

This is not a theoretical partnership. It is a practical, working system that supports jobs, drives innovation, and underpins our collective security. And it works. But it is also under pressure.

Canada is increasing its defense spending and seeking to build more capacity at home. That is both necessary and overdue. The lessons of recent conflicts are clear: supply chains matter, production capacity matters, and resilience matters.

At the same time, there is a risk that this shift could be misinterpreted. In Washington, there are concerns that “building in Canada” might mean excluding Canada from a reciprocal partnership that has seen Canada enjoy priority status in U.S. military procurement. In Canada, there is a parallel concern about over-reliance on external suppliers.

These concerns are understandable, but they are not the right framing.

Canada and the United States do not face a choice between independence and cooperation. We face a shared imperative to build more capacity within an already integrated system.

Canada brings significant strengths to this partnership, particularly in advanced technologies such as artificial intelligence, quantum computing, aerospace, and space - based systems. The United States brings scale, capital, and global reach. Together, we have the ability to compete - and lead - in a rapidly evolving defense environment.

The challenge is to align policy with that reality.

Canada’s procurement system, for example, remains too slow and too complex. Businesses struggle with uncertainty, and smaller firms - the ones driving innovation - lack access to capital. There is also a need for clearer communication around how new industrial strategies will affect cross - border collaboration. These are not insurmountable problems. But they do require focus.

If we are serious about strengthening North American defense, we need to move faster, provide clearer signals to industry, and ensure that our policies reflect the integrated nature of our economies. We also need to recognize that our greatest advantage lies not in trying to do everything ourselves, but in doing more together.

The future of defense is changing. It is no longer defined solely by large platforms and traditional systems. It is increasingly shaped by data, software, satellites, and autonomous technologies. These are areas where Canada excels - and where collaboration with the United States can unlock even greater potential.

The conversation in Toronto was constructive, candid, and, above all, pragmatic. There was broad agreement that the Canada-U.S. partnership remains strong, but that it cannot be taken for granted.

We have a choice. We can allow uncertainty and misalignment to erode one of the most effective bilateral relationships in the world. Or we can build on a foundation of trust, interoperability, and shared success to create something even stronger.

From where I sit, the answer is clear. Canada and the United States don’t need to rethink defense cooperation. We need to reinforce it together.

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