In my last Blog entry --- Let’s Make Canada Great – Now! --- I provide you with my thoughts, and general overview, on Canada’s pivotal economic transformation (2025-2035). Here I am expanding the focus on Canada’s opportunity from an investor’s perspective. While much of Washington’s daily drama plays like a political reality show, behind the scenes, decisions on tariffs, defense production, and industrial policy are reshaping the investment landscape across not only North America but also globally. We need to move decisively --- because the capital, the supply chains, and the market leadership of the next decade are being determined now.
The Strategic Realignment: Reshoring as Investment Thesis
In past decades, globalization lowered production costs but introduced strategic vulnerabilities. COVID-19, China tensions, and geopolitical disruptions exposed how fragile the global supply chain had become. Now, under a resurgent industrial strategy, the U.S. is:
- Proposing a 10% universal tariff
- Expanding subsidies for domestic production (semiconductors, EVs, defense)
- Enforcing “Buy American” provisions with new rigor
- Designating key sectors as matters of national security.
For Canadian investors, this is not a zero-sum game. It is an inflection point. Canada's proximity, resources, and political alignment make it a preferred partner in America's new industrial framework. There is little time for talk and debate — words without action are failure.
Energy: Fueling the Industrial Rebuild
Canada’s LNG projects are finally gaining momentum:
- LNG Canada (Kitimat) nears completion offers global options
- Woodfibre LNG and Cedar LNG show First Nations-led progress equally offers global options.
Hydropower from Quebec and Manitoba can support decarbonizing U.S. grids. Investors should watch transmission companies, utilities with export capacity, and firms supporting cross-border energy infrastructure.
Small Modular Reactors (SMRs) offer longer-term upside. Licensing alignment with the U.S. could open binational deployment opportunities and equally global opportunities.
Industrial Policy: The New Playing Field
Canada’s best approach is alignment, not independence. With USMCA, Canadian-made components count toward U.S. local content rules.
Strategic investments already underway include:
- Volkswagen and Stellantis gigafactories in Ontario
- GM and Ford integrating Canadian supply
- AI and robotics clusters supporting North American smart factories.
Watch for companies that connect supply, automation, and logistics across the border.
Mining: The Critical Mineral Gold Rush
In the Washington D.C Political Theater --- markets read and interpret the scripts carefully and adjust accordingly. The reality is that the U.S. cannot meet its strategic mineral needs alone. It imports nearly all its rare earths, over 50% of its lithium, and substantial portions of nickel and graphite—essential for EV batteries, defense systems, and renewable power.
Canada holds significant reserves in lithium, nickel, and rare earths. But the bottleneck is not geology—it is policy.
Investors can capitalize by focusing on:
- Juniors with proven reserves in stable jurisdictions --- for some investors they may not prefer to invest in juniors due to the speculative nature of the investment. However, Mid-Tier companies and Royalty Firms offer Moderate Risk, while ETFs provide broad and minimal to low risk options.
- Vertical integration across mining and refining --- Moderate Risk options generally.
- Partnerships with U.S. firms or qualification for U.S. defense funding firms.
Historical Parallels: When Policy Drove Capital North
Past policy-driven capital waves include:
- WWII: Canada’s defense output surged as part of the U.S. arsenal
- NAFTA: Foreign direct investment flooded Ontario’s auto sector
- 2000s Oil Sands: U.S. energy insecurity boosted Alberta’s oil projects.
These periods show that coordinated policy can trigger rapid industrial growth. Reshoring is the latest catalyst.
Why the Time Is Now
Key U.S. policies are already active:
- Reshoring zones are funded and permitted
- Defense procurement now favors North American sources
- Battery and EV supply chains are in active construction.
Canadian investors can front-run capital flows by backing assets tied to U.S. strategic demand. This is not a long-cycle bet. The money is already moving.
Final Word for Investors
The U.S. reshoring wave is the biggest industrial shift in decades. Canada is positioned to supply the materials, energy, and know-how needed—but only if capital mobilizes quickly.
Focus your investment research on:
- Critical minerals with offtake agreements
- Hydropower and LNG export infrastructure
- Industrial automation and logistics.
The policies are strong. The resources are real. The window is open.
Investors should view Canadian assets as part of a larger realignment in global trade, where secure access to minerals, energy, and industrial inputs is the new competitive advantage.
This trend positions Canada uniquely—not just as a U.S. partner, but as a reliable hub for diversified global supply chains. With its deep resource base, clean energy, and trusted governance, Canada offers geopolitical stability that few resource-rich nations can match.
Countries such as Japan, India, and those in the EU are enacting their own versions of 'friendshoring' and 'nearshoring.' Japan is subsidizing companies that relocate production from China. India’s 'Make in India' policy offers aggressive incentives to boost local manufacturing. The EU is doubling down on industrial sovereignty through its Critical Raw Materials Act and strategic green investment frameworks.
Global supply chain shocks—from the COVID-19 pandemic to the war in Ukraine and ongoing Red Sea disruptions—have prompted advanced economies to rethink their dependence on offshore production. The risks of just-in-time global logistics have now been internalized by policymakers worldwide.
While the U.S. leads the current reshoring movement, the strategic realignment is global in scope.
John Vidas
July 2025