Ottawa stands at a defining crossroads in its pursuit to reclaim global leadership in artificial intelligence. Despite a foundation built by world-renowned researchers and strong academic institutions, Canada faces mounting pressure as the commercial deployment of AI technologies lags international competitors.
The federal government, led by Innovation, Science and Economic Development Canada (ISED) and Minister of Artificial Intelligence and Digital Innovation Evan Solomon, has announced a “refresh” of the national AI strategy set for delivery in late 2025. The strategy will introduce a new task force uniting industry, academia, and civil society to shape the next phase of Canada’s AI ambitions.
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The Federal AI Strategy Refresh
Ottawa’s decision to recalibrate its national AI strategy underscores the government’s recognition that leadership in research alone no longer guarantees global competitiveness.
The 2025 refresh aims to expand Canada’s AI footprint from the laboratory to the marketplace by developing clearer policies for commercialization, workforce training, and ethical deployment. The involvement of multiple stakeholders, including industry, academia, and civil society, ensures that the new approach balances innovation with accountability while also prioritizing transparency and inclusivity in governance.
The updated AI strategy will focus on actionable mechanisms that directly link research output to industrial productivity. By fostering collaborations between universities and private firms, Ottawa hopes to bridge the persistent gap between scientific advancement and economic application.
Evan Solomon has emphasized that Canada’s next phase of AI policy will not only focus on innovation but also on delivering tangible benefits across industries, positioning the nation as a credible player in both ethical leadership and commercial scale.
The Legacy of Canadian AI Research
For decades, Canada has been a global pioneer in artificial intelligence research, with figures such as Geoffrey Hinton and Yoshua Bengio shaping the foundation of deep learning and neural networks.
Cities like Toronto, Montreal, and Edmonton have become international hubs for AI research and talent. However, while the academic influence remains strong, Canada’s ability to convert scientific breakthroughs into competitive commercial applications has lagged nations with more aggressive investment in industry adoption.
The challenge now lies in translating Canada’s theoretical strengths into business impact. The country’s research institutions continue to produce cutting-edge discoveries, yet the infrastructure for scaling these innovations commercially has not kept pace. This gap reflects a broader structural issue in Canada’s innovation ecosystem: a heavy focus on research excellence without sufficient mechanisms for commercial deployment and global competitiveness.
The Commercial Adoption Gap
Despite its research pedigree, Canada remains behind in the global race for AI adoption. Only about 26% of Canadian organizations have implemented AI systems, compared to approximately 34% globally. This discrepancy highlights a critical need for policies that support integration across sectors, particularly for small and medium-sized enterprises (SMEs) that lack resources for large-scale AI implementation.
The underperformance in commercial uptake poses serious risks to productivity and competitiveness. Without faster integration of AI into real-world operations, Canada risks remaining an exporter of intellectual property rather than a builder of scalable AI products. Enhancing adoption will require strategic partnerships, accessible compute resources, and workforce reskilling initiatives that align academic advances with market realities.
The Canadian Sovereign AI Compute Strategy
In response to the need for domestic capability, Ottawa launched the Canadian Sovereign AI Compute Strategy in 2024, committing up to C$2 billion by 2025. The investment targets expansion of high-performance computing infrastructure, support for scaling Canadian-led AI firms, and affordable access for SMEs to advanced AI systems.
This initiative marks a deliberate move toward technological sovereignty. By strengthening national compute infrastructure, Canada can ensure that its companies and researchers are not reliant on foreign providers for computational power. The C$2 billion commitment reflects a long-term effort to keep intellectual property and innovation value within the country, reinforcing both economic and digital independence.
Productivity and Economic Concerns
Productivity stagnation has become a recurring issue for the Canadian economy, with output per worker showing limited growth in recent years. AI is increasingly viewed as a potential catalyst to reverse this trend, but only if it is applied beyond research labs and integrated into business processes across sectors.
Adoption of AI technologies in manufacturing, logistics, finance, and healthcare could help Canada close its productivity gap. Automation, predictive analytics, and machine learning can enhance efficiency, reduce costs, and drive innovation. However, without broader commercial deployment, these benefits will remain largely theoretical.
The Push for Digital Sovereignty
A major motivator behind Ottawa’s AI agenda is the pursuit of digital sovereignty. Policymakers are determined to prevent Canada from becoming a “branch plant” of another country’s AI economy. Maintaining control over data, compute, and intellectual property is vital for protecting national interests in a global market dominated by tech giants.
To secure autonomy, Canada must ensure that its AI firms have the infrastructure and capital to compete independently. The development of domestic compute capacity and the nurturing of local talent are central to preventing reliance on foreign platforms. This vision extends beyond economics, it is about ensuring that Canada retains ownership of its digital destiny.
Building Public Trust in AI
Public confidence remains a critical barrier to widespread AI adoption. Surveys indicate that only about 31% of Canadians express trust in AI technologies. Without broad societal trust, even the most advanced systems will face resistance from users and regulators alike.
Increasing trust requires strong governance frameworks that prioritize privacy, fairness, and accountability. The refreshed AI strategy aims to embed these principles at every stage, from research to deployment. Transparent data practices and explainable AI models can reassure citizens that the technology serves public interests rather than undermining them.
The Role of AI in Sports Betting and Online Gaming
Artificial intelligence is reshaping the sports betting and online gaming sectors through predictive analytics, real-time odds adjustments, and personalized promotions. These technologies enable operators to understand player behavior at unprecedented depth, tailoring offers to increase engagement and retention.
Canadian-based betting and gaming firms must accelerate AI adoption to remain competitive. As international operators deploy sophisticated models to optimize odds and marketing, local companies risk losing market share without equivalent innovation. Ottawa’s AI policies will directly affect how these businesses evolve in the coming years.
Implications for Canada’s Global Competitiveness
The outcome of Ottawa’s AI policy decisions will determine Canada’s place in the global technology hierarchy. If the upcoming strategy succeeds, it could revitalize the country’s economic performance and establish leadership in ethical AI. Failure, however, would risk cementing Canada’s status as a research hub without commercial leverage.
The next few years will be decisive. Success will depend on how effectively Canada aligns research strength, compute resources, and industrial demand. By ensuring that funding translates into real-world applications, Ottawa can transform its AI leadership from academic prestige into lasting economic influence.
The Road Ahead for Ottawa’s AI Agenda
Canada’s AI future hinges on execution. The task force led by Evan Solomon must convert the momentum of policy design into measurable results. Infrastructure, trust, and sovereignty are now as vital as algorithms and data models.
Ottawa’s challenge is not about imagination but implementation. With C$2 billion already earmarked, the question becomes whether Canada can scale its innovations, sustain its competitiveness, and restore productivity growth. The coming strategy refresh will reveal if Canada’s AI gamble pays off, or if its leadership remains confined to the pages of academic journals.
