Space

This op-ed originally appeared in the Toronto Star

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Canada has entered a new space age.

The Carney government announced a historic commitment of $528.5 million to European Space Agency (ESA) programs, all of which will return to Canadian companies, enabling them to build deeper partnerships with European space and defence projects and companies.

It also says to the world that Canada wants to be a serious space player again, and to partner with plenty of allies beyond the United States.

One big step for Canada, yes, but compared to the even larger new space investments that other countries are making, it is still only one small step for humankind. To be a major global space player again, Canada needs to do much more, and do it quickly. To thrive in this new space age, we will need far more private capital and entrepreneurs than we’ve ever seen in our country. We need to attract and keep space investors (and there’s far more than Elon Musk out there), and ensure they’re generating capital, ideas, technology and high-value jobs in Canada — something other emerging space powers, from India to Japan to Germany, are already doing.

Our new report, A Higher Orbit: How Canada can build and finance a bolder space strategy, recently published by RBC Thought Leadership, lays out this new space imperative for Canada. It can’t be overstated: our sovereignty, Arctic defence, tech capabilities and economic prospects are all at various degrees of risk. Indeed, at a time when Canada is looking north, west and east, we need to look up, too — with much more ambition.

Let’s start by reconciling with the ground we’ve ceded. Canada was the third nation to go to space, in the 1960s, and for decades a pioneer and partner for our allies. Then we lost our way. Over the past decade, our space spending flatlined and were surpassed by numerous other countries.  Today, even the Netherlands spends a greater percentage of GDP on spacethan Canada.

Budget 2025 aimed to relaunch Canada’s space ambitions, quite literally. In addition to the ESA announcement, the budget allocated $182.6 million for domestic orbital launch capabilities, most likely to build two Atlantic Canada spaceports. Little else matters if we can’t launch our own rockets and vehicles into space, which is the case today. Until we do, we will be a passenger on SpaceX and other countries’ rockets — and beholden to their laws, timelines, and priorities.

Once we have Canadian controlled launch, we see a bold decade ahead in which Canadian satellites can join the front of the pack in earth observation and communications. Those will be our eyes and ears on the Arctic, and for Canadian interests everywhere. They also will be critical to our evolving security alliances and protecting our sovereignty. This is where elbows up needs to become heads up.

Beyond national defence, our research shows significant economic potential, touching pretty much every sector. The global space economy, led by the U.S. and China, is on course to triple in value to $1.8 trillion (US) over the next decade. Japan, Germany, India, South Korea and the United Arab Emirates are all gearing up national space programs to capture their share of that prize.

Corporate Canada needs to look up, too. As the saying goes, every company is now a space company. So, too, is every digital citizen. Whether you know it or not, your data travels, on average, 40 times a day through low orbit — and right now, that’s not secure as recent research indicates that satellites may be broadcasting up to half of their traffic through unencrypted channels.

Modelling from RBC Thought Leadership shows the need for roughly $12 billion in new capital for Canadian space ventures over the next decade, which in turn can generate more than $20 billion in annual industry revenue.

To get there, we will need a bolder strategy. That starts with a procurement pathway that says to the world what we’re willing to spend over the next five-10 years. If Canada commits 5 per cent of our enhanced 5 per cent NATO commitment to space, the government will be able to map out $7.5 billion a year in space spending — that’s enough to catapult Canada back into the peloton of advanced nations, less reliant on the U.S. and China. Without long-term commitment, global investors — the ones who can multiply that public investment — will not see Canada as a serious player.

Next, the upcoming Defence Industrial Strategy needs to lay out which sectors within space are top priotities. Much of this can be technologies that we are already excellent at – such as synthetic aperture radar and space robotics – but it will need to include new areas, such as counter-space systems, as well.

In addition to security and economic benefits, space monitoring technologies are critical to mitigating climate change, from melting ice conditions to changing water systems and shorelines. Quite urgently, space tech needs to play a leading role in our ability to predict, prevent and fight wildfires — a capability we can export to our allies, too.

Then there’s the Buy Canadian mandate. We can actually do more, and faster, in space than on Earth. We have globally respected companies, from big players like Brampton’s  MDA Space and Telesat in Ottawa to fast-growing innovators like Toronto’s Kepler and Montreal’s GHGSat, which can all scale more rapidly for global markets.

Recently, at SpaceBound, the annual forum organized by Space Canada, we were encouraged to hear Defence Minister David McGuinty and Industry Minister Melanie Joly share more of the government’s ambitions for space. Both ministers along with senior military officials carried that message to the Halifax Security Forum.

In Ottawa, we also convened a private roundtable with companies and investors who said much more needs to be done. Canadian investors — from private equity to pension funds — need to sharpen their space skills, as we’re seeing instutional investors do in the U.S. and Europe. Federal financial institutions like Export Development Canada and Business Development Bank of Canada need to make space a greater priority within their new strategies for defence finance. And our colleges and universities — long champions of space innovation — need to up their games in both the commercialization of research and training of a new generation of space pioneers.

The moment for that is now. When Jeremy Hansen joins the Artemis II mission to the moon this winter, he will be the first non-American to ever leave Earth’s orbit. It can be a defining moment, to all Canadians, to say to outselves and to the world: we’re going to make a lot more space for Canada. Just look up.

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Authors

Alexander MacDonald, Former Chief Economist, NASA
Jaxson Khan, CEO, Aperture AI | Senior Fellow at University of Toronto
John Stackhouse, Senior Vice President, Office of the CEO, RBC