Canada’s national AI strategy – a long-awaited, $2.3B behemoth of investment, policy and funding – aims to retain Canadian talent and chart clearer paths from research to commercialization. It’s a significant opportunity for international companies that want to drive innovation in AI.
“The AI strategy is designed to benefit Canada and Canadians, but it also presents opportunities for global companies to leverage our talent pool and innovation capacity,” said Erin D’Alessandro, Vice-President of Business Development at Waterloo EDC.
The Government of Canada’s “AI for All” plan prioritizes talent retention, capital growth, AI adoption and sovereign infrastructure. Ever since the Waterloo region emerged as an AI hotspot years ago, our ecosystem has employed a similar strategy. Talent, innovation, commercialization and ethical deployment were—and remain—the foundation of our growth.
Now, there’s clear government buy-in. Adding in the power of federal funding strengthens the AI ecosystem in our community and across the country, streamlining collaboration and innovation from sea to sea.
Key Takeaways
- Canada’s $2.3B “AI for All” strategy targets talent, capital and AI adoption in sectors like robotics, life sciences and agriculture
- Waterloo’s AI ecosystem — built on talent, research and commercialization — aligns with the federal strategy’s key pillars
- For companies expanding in Canada, the Waterloo region offers direct access to federal AI programs, world-class talent and a proven path to market
1. Talent retention
Canada has produced some of the best AI minds and was an early leader in the AI race. We’re currently ranked #1 in the G7 for year-over-year growth of AI talent, and several international AI leaders are Canadian citizens. Examples include Geoffrey Hinton, the Nobel-winning “Godfather of AI,” OpenAI co-founder Ilya Sutskever and Google DeepMind research director Doina Precup.
The allure of Silicon Valley can push up-and-coming AI talent south of the border. But Canada’s AI strategy gives talent more reason to stay. To target talent retention and company growth, the government is:
- Expanding the Canadian Institute for Advanced Research AI Chairs program from 130 to 200 research positions
- Speeding up permanent residency pathways for highly skilled AI workers through the Global Talent Stream
Not only do these programs ensure Canada remains competitive for AI talent, but they also ensure that international companies locating here have unique access to AI expertise and global AI talent.
2. Capital growth
A renewed federal investment in AI capital amplifies the opportunity for Canadian AI ventures to compete on the global stage, giving companies more reason to scale and succeed here. The strategy includes:
- $500M for the Canadian Tech Growth Fund, which will give the government the option to take equity stakes in high-potential startups, helping firms attract more private capital, retain talent and protect IP
- $130M in funding to national AI institutes for commercialization programs
By targeting capital and commercialization, the government is creating conditions for homegrown innovation to reach its full commercial potential.
3. AI adoption in priority sectors
To encourage AI adoption, the strategy allots $500M through regional development agencies specifically to boost AI adoption and commercialization among businesses. Priority sectors include life sciences, energy, agriculture, manufacturing and robotics – a list that aligns with Waterloo region’s industrial strengths.
Additionally, the government is investing $700M for the AI Compute Access Fund, which aims to help small and medium-sized businesses (SMEs) cover the computing costs associated with AI adoption.
4. Sovereign infrastructure
Strengthening Canada’s technological sovereignty is another key pillar of the strategy. To build sovereign AI capabilities, the government is investing in:
- Domestic data centres and compute capacity
- National data-sharing initiatives
- A public supercomputer for Canadian researchers and SMEs to access sovereign, high-performance computing infrastructure
With a “build-partner-buy” approach, the government will build key sovereign infrastructure domestically, while partnering with trusted allies or buying existing market solutions when appropriate.
Did You Know?
Canada was the first country in the world to launch a funded national AI strategy.
Where Waterloo fits in
The pillars of the policy are already foundational to our AI ecosystem and what our community has been building toward since Hinton was crowned the godfather of AI. Now, the new federal strategy adds capital, structure and a national mandate to existing strengths.
“From talent retention to research investment to AI sovereignty, the Waterloo ecosystem is a perfect match to this strategy,” said D’Alessandro.
Talent
Universities are at the centre of AI ecosystems. They have young talent, acclaimed researchers, innovation hubs and people dedicated to commercialization.
“Waterloo is probably one of the most famous examples of this,” said Minister Solomon late last year to University Affairs. “You’ve got the Institute for Quantum Computing, OpenText and the university all on the same campus, and stories of cross-pollination and research that are fantastic.”
The collaboration at the University of Waterloo contributes to the calibre of our talent pool. It makes our AI workforce more dynamic, innovative and entrepreneurial.
When Solomon visited students at the University of Waterloo earlier in 2026, he spoke to this conviction. “Every single person in this room is among the most in-demand students in the world,” he said. “If you’re at Waterloo studying math, science or engineering, the global market has already noticed you.”
Research
Since 2019, Canada has annually published the most AI-related papers per capita in the G7. Across the country, exceptional researchers are inventing the technology that forms the bedrock of AI in software and hardware applications. With 22 AI-related research centres and labs, the Waterloo region is pivotal to Canada’s research output.
One example is the Waterloo Institute for AI and Data Science (Waterloo.AI). The hub is affiliated with the University of Waterloo and is internationally recognized for its work with real-world challenges. Waterloo.AI frequently partners with industry leaders, innovation reaching well beyond the university’s campus, enabling AI commercialization and integration in several key industries.
Commercialization
Canada has always had world-class AI research, and now market momentum is building—Canadian AI firms file patents 3x the average rate in the G7. The strategy is about continuing to transform ideas into action and businesses. And Waterloo’s capacity for commercialization can be the strategy’s linchpin.
Years of commercialization expertise are under our belts, thanks to the entrepreneurial roots of our startup ecosystem. With a solid support system and available resources, entrepreneurial ventures thrive in Waterloo. Velocity, the University of Waterloo’s flagship incubator, has produced 500+ companies with $40B+ in enterprise value and 1,200+ founders.
Infrastructure
The key to the entire strategy is the availability of AI infrastructure that enables the growth of Canada-based AI companies and, ideally, ensures greater data sovereignty.
Waterloo has been active in the infrastructure space, welcoming a new OVHcloud data centre with a strong data sovereignty mandate in 2024 and another in 2025 built specifically to support Canadian AI innovator Cohere.
The Waterloo region continues to be a focal point for proposed new AI infrastructure.
Why does this matter for expanding companies?
For international companies looking to enter or expand in Canada, the Waterloo region has the foundation to turn strategy into results. Our existing AI infrastructure—talent pipeline, research institutions and a proven commercialization track record—means companies don’t need to build from the ground up. You land in an ecosystem already wired for AI growth, with direct access to federal funding, one of the best workforces in the G7 and a community of peers scaling in the same space.
Waterloo is all in on “AI for All.” Join us to invent its future.