Only time will tell whether this week’s inaugural Canada Investment Summit will generate the $500 billion in new investment Ottawa says it “unleashed.”
Three experts who spoke to Canadian Affairs were circumspect about the summit’s impact, noting much depends on whether Canada addresses the factors that have long made Canada an unattractive destination to invest.
But the event did produce at least one immediate win, as well as some reasons to worry.
Win
The government announced a new Productivity Mega Deduction that some experts are saying could be one of the most significant tax changes in years.
If passed, about 65 per cent of Canadian business capital assets would be eligible for immediate expensing, up from about 15 per cent today. Eligible assets would include things like fibre-optic cable, pipelines, software, R&D, intellectual property and infrastructure.
This is a positive change. The smaller class of assets previously eligible for immediate write-off were primarily related to manufacturing, clean energy and research and development.
The measure could materially help boost Canada’s productivity, which must be a top priority. It would make businesses more likely to make productivity-boosting investments by lowering the effective price of making these outlays.
Why?
One of the more perplexing summit announcements was Ottawa’s pledge to enable private investors to become operators of Canada’s four international airports. Ottawa said it would retain ownership of the underlying assets, but seek private investment through concessions and leases.
It is not clear how this kind of private involvement would benefit the public.
Airports are natural monopolies, which governments are often best placed to own and run. The government has also already taken the risk of constructing these airports, so investors would be stepping in after all the heavy lifting has been done, so to speak. They would be assuming minimal risk, yet would still need to be rewarded handsomely to make their investments profitable.
To induce this investment, governments would run the risk of pricing the assets too low, or agreeing to profit-boosting terms that are bad for Canadians.
A cautionary tale is the Ontario government’s 1999 sale of Highway 407 to a private consortium. The government built the highway, and then sold a 99-year lease on it for about $3.1 billion. This price was widely seen as being well below the asset’s market value. Tolls have climbed year after year.
There would seem to be a similar risk with the airports. The Canadian Press reported this week, for example, that Australian passengers saw price increases after Australia began privatizing its airports.
We’ll see
Foreign Direct Investment
Foreign direct investment (“FDI”) is not necessarily an unalloyed good for Canada. The type of FDI matters a great deal.
FDI can be used to build entirely new facilities or operations. But it also includes mergers and acquisitions (“M&A”), where foreign firms purchase existing Canadian companies or assets.
“[M&A] is just purchasing activity that’s already going on,” Kaylie Tiessen, chief economist at the Canadian Shield Institute for Public Policy think tank, told Canadian Affairs in June. “That’s not creating any new activity.”
Indeed, M&A can actually reduce Canadian economic capacity over time if corporate leadership, research functions or intellectual property are relocated abroad.
In 2025, FDI into Canada reached $96.8 billion, with M&A activity accounting for about half this total. That year, more than half of FDI came from the United States, Canadian Affairs reported in June.
This trend may be accelerating. In the first half of 2026, total FDI was $44.7 billion, and more than two-thirds of it came from the United States.
If Ottawa’s overarching aim is to make Canada more self-sufficient, selling our businesses to U.S. investors is at cross-purposes with this goal.
Ottawa must start placing greater emphasis on attracting the right kind of foreign investment — and collecting better data.
In June, Statistic Canada could not provide Canadian Affairs with data on how much FDI leads to new productive capacity in Canada. Without such information, we are flying blind.
‘Maple’ Funding
Various Canadian pension funds and banks pledged this week to invest enormous sums within Canada in the coming years.
The CPPIB and Brookfield Asset Management, for example, announced a framework to contribute up to $25 billion each over five years to large-scale Canadian infrastructure and strategic industries.
The coordinated nature of these announcements suggests these firms may have been nudged by Ottawa to make these commitments. If so, this is worrisome.
While we want Canadian funds to invest in Canada, we would not want them to do so at the expense of their primary mandate: to generate the best possible returns for pensioners.
Put another way, Canadian firms should only invest in Canadian infrastructure and assets where doing so is an optimal investment decision. We would be loath to see their primary mandates take a back seat to politics — or for governments to encourage this.
In short, this week’s buzzy press releases and news headlines told a good story. But the jury is still out on whether all the hype will translate into something of substance.
