Amid heightened geopolitical turbulence, intensified competition for critical resources, and accelerated defence expenditures among North Atlantic Treaty Organization allies, KPMG’s national interest and defence study has acknowledged the Canadian government’s recent momentum in spotlighting defence, sovereignty, and resilience as national priorities.
According to KPMG, through the 2025 Budget and Defence Industrial Strategy (DIS), Canada has demonstrated efforts to fortify its domestic industrial capacity, decrease strategic dependencies, and improve economic resilience throughout infrastructure, energy, digital sovereignty, and defence.
“Defence spending can be a powerful economic driver, especially if it is used to build Canada’s domestic industrial base and boost long-term productivity,” said Ali Jaffery, chief economist of KPMG Canada, in a media release.
KPMG highlighted that Canada should be able to execute projects at speed and scale to transform its recent progress into long-term economic and strategic advantage. KPMG added that Canada should work to translate strategy into capability.
“The government’s direction is encouraging, but delivery is the real test,” Jaffery said. “The next step is turning ambition into action.”
Tim Prince, KPMG’s Canadian managing partner for clients and markets, noted that Canada is facing high stakes amid swiftly rising demand for secure supply chains, critical minerals, energy, and defence capacity.
“Canada is well positioned to play a larger role in delivering this demand but capturing that opportunity will require government, industry and other national stakeholders to align around faster and more effective project delivery,” Prince said in KPMG’s media release.
Suggested steps
KPMG’s report urged industry, government, Indigenous groups, and other stakeholders to improve coordination to boost Canadian competitiveness and hasten projects.
For Canada to fulfill its defence goals, KPMG emphasized the importance of procurement improvements, workforce readiness, access to financing, and Indigenous collaboration, with early involvement and governance participation.
To speed up project delivery, encourage private investment, and fill long-term deficiencies, KPMG stressed the importance of implementing the DIS and ensuring access to new capital via initiatives such as the Defence, Security, and Resilience Bank.
Sources of pressure
Among Canadian business leaders interviewed, 63 percent thought that complex procurement and funding processes were delaying large capital projects.
Canada’s business leaders also believed that limited skilled talent and access to capital and tax incentives, especially for smaller businesses, were making it more difficult to deliver projects and introduce ideas into the market.
More on study
As a multi-year commitment, KPMG’s national interest and defence study seeks to spur discussion concerning the country’s shifting defence and resilience ecosystem and help leaders and government translate insights into execution.
For its new study, KPMG sought input from over 70 leaders across defence, capital, infrastructure, digital, supply chains, communities, and organizations.