For those of us devoted to ensuring Canada’s security in an increasingly dangerous world, one aspect of the Speech from the Throne delivered by King Charles III stood out:
“The Government will protect Canada’s sovereignty by rebuilding, rearming, and reinvesting in the Canadian Armed Forces. It will boost Canada’s defence industry by joining ReArm Europe, to invest in transatlantic security with Canada’s European partners. And it will invest to strengthen its presence in the North, which is an integral part of Canada, as this region faces new threats.”
This is a significant announcement. If the government makes good on this commitment, there could be real, tangible benefits for Canada.
What is ReArm Europe?
ReArm Europe is the European Commission’s plan to leverage the industrial strength of the continent to expand its domestic defence industry at a rapid pace, as the continent faces what they are calling “a rapidly deteriorating strategic context.”
While the plan is not explicitly aimed at responding to the foreign policy shift of the United States, the unpredictability of U.S. foreign policy under Donald Trump’s administration has left Europe unsure of NATO assistance were they to be attacked by Russia.
Further, the European Union has, like Canada, severely underutilized its latent military-industrial potential. Consider that Canada alone outstrips Russia in GDP (USD $2.2 trillion vs USD $2.1 trillion), and the combined EU GDP is roughly USD $20 trillion. Combined, Canada and the EU outmatch Russia more than ten to one.
Now, purchasing power parity (most of Russia’s weapons are domestically produced), and Russia’s shift to a war economy, means Russia is punching above its weight in military production compared to GDP, but that doesn’t change the fact that were Canada and the EU to hit 3% or 4% of GDP on defence, Russia would be completely outmatched in a conflict, even if the U.S. sat it out.
A financial commitment that matches lofty rhetoric?
Without a financial commitment, lofty words about rearmament are worthless. The ReArm Europe plan appears to recognize this, as it proposes $150 billion worth of loans for EU member states, backed by the EU budget, to fund rearmament.
Keep in mind that addional EU-backed investment is in addition to what individual countries spend on rearming. Germany – Europe’s largest economy – recently amended its strict ‘debt brake’ to exempt military spending above 1% of GDP, opening the door to a significant expansion of the German military.
The EU is also loosening debt restrictions for investments in defence, potentially opening up another 1.5% of GDP in defence spending. Regulatory hurdles and the challenge of unifying disparate defence sectors will also be addressed under the plan.
Where does Canada come in?
The EU specifically mentioned Canada in its ReArm Europe white paper:
“Our cooperation with Canada has intensified and should be further enhanced, also to strengthen transatlantic security. The bilateral Security and Defence dialogue as well as the upcoming Security and Defence partnership provide the basis for enhanced security and defence cooperation, including on respective initiatives to boost defence industry production.”
Canada also has much of what the EU needs, particularly energy supplies and rare earth minerals. The EU has much of what Canada needs, in terms of defence companies that produce top-tier weapons and are willing to scale up production if we invest. There is also a growing values match between Canada and the EU, particularly in support of Ukraine and in defence of free trade and liberal democracy.
Finally, both wish to reduce their dependence on the U.S., which can only be done if the EU & Canada come close to matching overall U.S. military spending in aggregate. Ironically, the U.S. also stands to benefit from this, as it would reduce the burden on the U.S. military, and – in the event a more pro-NATO administration follows the current one – mean a much more powerful NATO alliance that could at least match the military-industrial power of China & Russia combined.
Joining ReArm Europe is thus a wise move by the Canadian government. If part of a real financial commitment to rearmament, it could help secure Canadian sovereignty and deepen our partnerships with other powerful nations that share our goals and values. It could also help boost our economy and job creation by bringing in billions of dollars of investment into Canada’s defence industry and tech sectors, with associated benefits in manufacturing and resource development.
Spencer Fernando
Image – YouTube
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