The Co-Investor Problem
Before Canadians are asked to trust a new public investment fund, they deserve to know which China Ottawa believes in: the biggest security threat, or the new strategic partner.
The Canada Strong Fund is being sold as a tool of economic sovereignty.
That is exactly why Canadians should ask who gets to stand beside the taxpayer.
The fund will begin with a $25 billion federal contribution and invest alongside the private sector in Canadian projects and companies, including energy, critical minerals, agriculture and infrastructure. The Prime Minister’s announcement also points to ports, mines, trade corridors and energy corridors as part of the broader nation-building strategy.
That sounds practical. Canada needs capital. Big projects need partners.
But not all partners are equal.
A Canadian pension fund is not the same as a foreign state-owned enterprise. A passive minority investor is not the same as a lender with security over strategic assets. A private infrastructure fund is not the same as capital tied to a government with geopolitical ambitions.
That is the co-investor problem.
The risk is not that China, Brookfield or anyone else “buys the Canada Strong Fund.” That is too crude. The real risk is project by project: a port here, a mine there, a processing plant, a rail corridor, a battery supply chain, an offtake agreement, a refinancing package when costs run over.
Control does not always arrive wearing a name tag.
China’s Belt and Road Initiative is built around infrastructure, transport corridors, ports, pipelines, fibre networks and access to raw resources. Canada’s own security-intelligence material describes it as a strategy to place China at the centre of international trade while drawing in the raw resources China needs. (Canada) The Silk Road Fund says its investments span infrastructure, energy, resources, industrial cooperation and financial cooperation.
That does not mean the Canada Strong Fund is a Belt and Road vehicle. It means the sectors overlap.
And overlap is enough reason for hard rules.
The concern is sharpened by Ottawa’s own changing language. Less than a year ago, Carney described China as Canada’s biggest security threat, pointing to foreign interference, geopolitical risk, the Arctic, Taiwan and Beijing’s alignment with Russia. Now the government is speaking of a “new strategic partnership” with China in energy, agri-food and trade, while setting a goal to increase exports to China by 50% by 2030.
That may be realism. It may be necessity. Canada does need markets beyond the United States. But the shift from strategic threat to strategic partner should not happen quietly — especially at the same moment Ottawa is creating a $25 billion public investment fund for infrastructure, energy, critical minerals and trade corridors.
A country can trade with a rival. It can even cooperate selectively with a rival. But it should not pretend the rivalry has disappeared because the sales pitch has changed.
Before Canadians are asked to trust a new public investment fund, they deserve to know which China Ottawa believes in: the biggest security threat, or the new strategic partner.
Canada already knows this. Ottawa’s own critical minerals policy warns that investments by state-owned enterprises, or private investors influenced by foreign governments, can be driven by non-commercial motives contrary to Canada’s interests. It also says foreign SOE acquisitions in critical minerals should be approved only on an exceptional basis, and that even minority or greenfield investments can face national-security review.
Good. Keep that door locked.
But a lock is only useful if someone actually turns it.
Canadians have heard “don’t worry, there are safeguards” before. The Federal Court of Appeal has now confirmed that the federal government’s invocation of the Emergencies Act was unreasonable and beyond its legal authority, and that related measures infringed Charter protections for expression and unreasonable search and seizure.
That lesson matters here. Institutions do not protect a country by existing. They protect a country when people in power obey them — or when they can be stopped before the damage is done.
The Brookfield question belongs in this same category. There is no public evidence that the Canada Strong Fund is directing money to Brookfield. That should be said plainly.
But there is an optics problem. Carney’s disclosure listed Brookfield Corporation options and deferred share units, Brookfield Asset Management options and deferred share units, and a notional long-term incentive plan in the Brookfield Global Transition Fund as assets placed in a blind trust. Global News has reported that his ethics screen is meant to prevent him from participating in official matters involving Brookfield, Brookfield Corporation, Stripe and companies they own or control.
That may satisfy the formal rules. It does not satisfy the public’s need to see the rules work.
Because the fund’s target universe — infrastructure, energy, transition projects, critical minerals — is exactly the terrain where firms like Brookfield operate. Again, that is not proof of wrongdoing. It is proof that transparency has to come before the money moves.
If this fund is arm’s-length, show us the arm.
If foreign state-linked capital is excluded from strategic projects, say so clearly.
If Brookfield-linked entities are screened out of decisions involving the Prime Minister, explain how that works when investments involve subsidiaries, consortia, funds, broad asset classes or private partners.
If taxpayers are taking risk to make projects bankable, name who gets the benefit.
The Canada Strong Fund may become a useful national tool. Canada does need patient capital. It does need to build. It does need to reduce dependence on one export market and one powerful neighbour.
But sovereignty is not created by pooling public money with private capital and hoping for the best.
Sovereignty depends on control.
Who owns the asset? Who finances it? Who operates it? Who holds the debt? Who gets paid first? Who gets access to the minerals, the corridor, the port, the data, the power, the processing capacity?
Those are not technical details. Those are the whole game.
A fund created to make Canada less dependent on Washington should not make Canada more vulnerable to Beijing. A fund created for Canadians should not become a concierge desk for politically connected capital. And a fund financed by taxpayers should not ask taxpayers to trust closed-door partnership decisions on projects that shape the country’s future.
The government does not need to prove a scandal has not happened.
It needs to prevent one from being built into the structure.
Before the first major investment is made, Canadians deserve a simple answer:
Who is allowed to stand beside the taxpayer — and what control comes with their money?
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