Canadian Government Plans $360 Million Tech Growth Fund in Effort to Drive Sovereign AI Industry

By Robb M. Stewart

OTTAWA--Canada's government will set up a technology growth fund to help fund promising artificial-intelligence companies, part of the hundreds of millions of dollars it plans to pump into building a home-grown AI industry and encourage adoption of the technology.

Prime Minister Mark Carney's government unveiled Thursday a new national AI strategy dubbed "AI for All" that includes plans for a 500 million Canadian dollars, or the equivalent of about US$360 million, fund aimed at closing what it says as the scale-up capital gap facing the country's most promising AI companies.

The Canadian Tech Growth Fund will offer flexible capital and investment support, while also providing a platform for Ottawa to at times take equity stakes in the most promising AI firms. The aim is to help these companies attract price capital, compete globally, retain talent and intellectual property and remain anchored in Canada, the government said.

Carney has described AI as the defining technology of the era, one that already is changing how people work, learn and connect.

"AI is here. The question is whether it will improve the lives of all Canadians or benefit only a few," he said.

The government strategy, introduced by Carney and AI and Digital Innovation Minister Evan Solomon at an event in Toronto, seeks to build safe, reliable and sovereign AI in what the prime minister said must be a pragmatic and prudent way. The plans center on pillars that include protecting Canadians from the risks and harms of AI, empowering Canadians to use and benefit from the technology, and building Canadian AI foundations in compute, data, talent and infrastructure.

There are more than 3,500 Canadian companies developing advanced AI models, tools and applications that have collectively raised more than C$37 billion in venture-capital funding, the government said. It points to estimates that generative AI alone could add C$187 billion annually to the Canadian economy by 2030 and create hundreds of new Canadian firms.

Use of AI in the country remains low. About 12% of Canadian companies were using AI to produce goods and services using AI as of mid-2025, a figure the government wants to increase to 60% by 2034. Carney said Canada also ranks near the bottom of countries in AI training, literacy and trust. And the country is highly dependent on foreign suppliers for the infrastructure that powers AI, from compute to cloud to data storage, he said.

Carney said this creates risks that foreign entities could access Canadian data, deploy AI products that shape Canadian lives and "tilt the playing field against Canadian firms."

The government's goals include helping create 250,000 new jobs through the adoption of AI by 2031, and supporting unlocking a 3% increase in gross domestic product from labor productivity that includes the commercialization and use of AI in key sectors.

It plans to provide all Canadians with access to free AI literacy training, and ensuring all post-secondary students have access to trusted AI agents. It also is looking to create up to 90,000 AI-related jobs and work placement opportunities for young Canadians to start their careers and support small and medium-sized businesses and nonprofits by 2031.

Planned government spending on the strategy includes providing C$500 million through a regional AI initiative to expand AI adoption, commercialization and readiness across the country. It will expand sovereign compute for Canadian small and medium businesses with an additional C$700 million added to the government's existing C$300 million Compute Access Fund, which last month said it had to date provided support for 44 projects.

The government additionally intends to launch an AI Missions Program to advance targeted projects that promise significant public good and meaningful improvements in Canadians' lives. The first mission will commit C$200 million to improving health care, the government said.

Ottawa has plans to update the laws and standards regarding privacy rights, ensure safeguards for children's online activities and protect vulnerable groups from online violence and algorithmic biases.

This would include providing Canadians with legal tools to combat deep fakes, ensuring that interactions with chatbots are safe. It would also strengthen privacy laws to ensure that Canadians' personal information isn't used inappropriately, such as for surveillance pricing.

The government said it would invest C$50 million to expand the capabilities of the Canadian AI Safety Institute to track emerging AI risks, advance technical research and to conduct transparent evaluations of AI models.

Write to Robb M. Stewart at robb.stewart@wsj.com

(END) Dow Jones Newswires

June 04, 2026 13:04 ET (17:04 GMT)