
Canada's shooting at a moving target on defence spending, say military watchers
Article content
'You can have as many drones as you want, if you want to hold terrain, if you want to protect yourself, you're going to need boots on the ground.'
Article content
Article content
Carney promised pay raises for those in uniform, but a technical briefing after his speech was short on details about who might get them.
Article content
'Corporal Bloggins needs a lot more than General Smith does,' said defence analyst David Perry, who heads the Canadian Global Affairs Institute.
Article content
'The senior ranks are pretty well compensated. The military has got an affordability cost-of-living issue in the lower ranks.'
Article content
For people who have to move regularly, like many in uniform, 'the total compensation package hasn't kept pace with changing cost pressures,' Perry said.
Article content
'The military is having a difficult time both getting people in and keeping them there once they do join. So, I think depending on how the pay measures are actually structured, it could have quite a significant impact.'
Article content
Canada spent about 1.45 per cent of its GDP on defence last year. If Canada's defence spending does hit two per of GDP by March of 2026, 'by then the target probably will have moved,' Rigby said.
Article content
'So, we've hit two per cent just as the target's likely to go to 3.5 per cent or even right up to five per cent if you throw in extra security capabilities … beyond pure defence.'
Article content
That will leave Canada 'playing serious catch up,' he said.
Article content
NATO leaders are meeting later this month to discuss boosting military spending.
Article content
'Two per cent is not going to cut it in terms of where the rest of the alliance is,' Perry said. 'Pretty clearly there is a discussion about getting to a number much higher than that at the upcoming NATO summit. But given that we have been falling short of this now … 11-year-old target, I do think it's a good first step to help regain some Canadian credibility by putting the money in the window to actually get to the two per cent mark this fiscal year.'
Article content
The other question is whether Canada be able to spend all of the promised money by next March, Rigby said. 'We all know that one of the problems over the last number of years is National Defence can't spend the money quickly enough.'
Article content
The Canadian Armed Forces (CAF) returns between hundreds of millions and over a billion dollars annually to central treasury, Perry told National Post earlier this year.
Article content
Carney is creating a defence procurement agency to help in that respect, Rigby said. 'It's not easy setting up new agencies. There are big machinery issues. It costs money. You've got to find the people.'
Article content
Hashtags

Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles

Globe and Mail
25 minutes ago
- Globe and Mail
Canada, China, Mexico, Japan and EU urge Trump not to impose new airplane tariffs
Five nations and the European Union, as well as airlines and aerospace firms worldwide, urged the Trump administration not to impose new national security tariffs on imported commercial planes and parts, documents released on Tuesday showed. Airlines and planemakers have been lobbying President Donald Trump to restore the tariff-free regime under the 1979 Civil Aircraft Agreement that has yielded an annual trade surplus of US$75 billion for the U.S. industry. The documents made public by the U.S. Commerce Department bared concerns over the fallout of possible new tariffs expressed by companies as well as nations such as Canada, China, Japan, Mexico and Switzerland, besides the European Union. 'As reliable trading partners, the European Union and United States should strengthen their trade regarding aircraft and aircraft parts, rather than hinder it by imposing trade restrictions,' the EU wrote. It would consider its options 'to ensure a level playing field,' it added. Trump has already imposed tariffs of 10 per cent on nearly all airplane and parts imports. 'No country or region should attempt to support the development of its domestic aircraft manufacturing industry by suppressing foreign competitors,' the Chinese government wrote. Separately, U.S. planemaker Boeing cited a recent trade deal unveiled in May with Britain that ensures tariff-free treatment for airplanes and parts. Opinion: Carney was right to not retaliate against Trump's latest tariffs 'The United States should ensure duty-free treatment for commercial aircraft and their parts in any negotiated trade agreement, similar to its efforts with the United Kingdom,' Boeing told the Commerce Department in a filing. Mexico said in 2024 it exported US$1.45 billion in aircraft parts, just a tenth of the total, to the United States. The EU said it took U.S. exports of aircraft worth roughly US$12 billion, while exporting about $8 billion of aircraft to the U.S. In early May, the Commerce Department launched a 'Section 232' national security investigation into imports of commercial aircraft, jet engines and parts that could form the basis for even higher tariffs on such imports. Last week, Delta Air Lines and major trade groups warned of tariffs' impact on ticket prices, aviation safety and supply chains. 'Current U.S. tariffs on aviation are putting domestic production of commercial aircraft at risk,' Airbus Americas CEO Robin Hayes said in a filing. 'It is not realistic or sensible today to create a 100 per cent domestic supply chain in any country.' Boeing said it had been increasing U.S. content in its airplanes over the last decade and its newest airplanes, the 737 MAX 10 and 777X, would have 'more than 88 per cent domestically-sourced content.' The United Auto Workers union, which represents 10,000 aerospace workers, said it supports tariffs and domestic production quotas, adding that U.S. aerospace employment has fallen to 510,000 in 2024 from 850,000 in 1990. 'To safeguard the entire aerospace supply chain across the commercial and defense sectors, comprehensive tariffs and production quotas on several products are needed,' it said. JetBlue Airways opposed new tariffs, however, saying, 'Trade policy should reinforce, not destabilize, the proven systems that keep our aircraft flying safely and affordably.'


CTV News
an hour ago
- CTV News
G7 Leaders' Summit road and trail closures in place around Kananaskis
The G7 Leaders' Summit begins Sunday, and in preparation, some roads and trails are now closed in the Kananaskis area.


Globe and Mail
an hour ago
- Globe and Mail
Analyst Outlook for American Financial Markets
Market Outlook (About (STA Research): Is a Canadian investment research company, consisting of Financial Professionals specializing in advanced stock research and analysis). Analysts have mixed expectations for the U.S. stock market for the remainder of 2025, reflecting a balance between cautious optimism and concerns over valuation and geopolitical risks and macro economic pressures. Bullish Outlook Several major financial institutions maintain a positive view for the remainder of 2025: Bank of America projects the S&P 500 to reach 6,666 by year-end, driven by anticipated earnings growth and potential interest rate cuts by the Federal Reserve. JPMorgan forecasts a 9% upside, targeting 6,500, supported by AI-driven investments and favorable global economic policies. Morgan Stanley sets a base case of 6,500, with a bull case of 7,400, contingent on continued economic momentum and policy support. . Cautious Outlook Conversely, some analysts express caution due to high valuations and potential economic headwinds: PIMCO warns that the equity risk premium is at historic lows, indicating that stocks may be overvalued relative to bonds, which could lead to market corrections. BCA Research anticipates a bearish phase in the first half of 2025, citing weakening consumer spending and potential recession risks. Sector-Specific Insights Analysts also provide guidance on sector performance: Small-cap stocks are expected to outperform in the second quarter, benefiting from attractive valuations and potential Federal Reserve rate cuts. Defensive sectors such as utilities and consumer staples are viewed favorably, offering stability amid market volatility. Technology and AI-related investments remain strong, with continued enthusiasm for advancements driving market interest. Top 5 Analyst Stock Picks For Q3 & Q4 1. Amazon (AMZN) Amazon's diverse revenue streams, including AWS, advertising, and logistics, position it for sustained growth. Analysts anticipate a reacceleration in AWS and potential growth in advertising, grocery, logistics, and Project Kuiper 2. Meta Platforms (META) Meta's investment in AI-powered applications, such as Llama 4, and its strong advertising recovery contribute to its growth prospects. The company has approximately 1 billion monthly active users for Meta AI. 3. Microsoft (MSFT) Microsoft's strategic partnerships and investments in AI, including collaborations with Fivetran and Fastino, enhance its growth prospects. The company's focus on AI-driven solutions positions it well for future gains. 4. Nvidia (NVDA) Nvidia is a leader in AI hardware, providing GPUs that power AI computing. The company's strong performance in 2024 and continued leadership in the industry contribute to its growth potential. 5. Salesforce (CRM) Salesforce's position as the #1 platform for integrated CRM services, coupled with its focus on AI-driven solutions, supports its growth prospects. The company's strong financials and market position make it a top pick for the upcoming quarters. Outlook The consensus among analysts for financial markets is a cautiously optimistic outlook for the near term and the remainder of 2025. While some anticipate market gains, others advise vigilance due to high valuations and economic uncertainties, and macro headwinds. Investors are encouraged to focus on sectors with strong fundamentals and consider a diversified approach to navigate potential market fluctuations.