Canada's Missing Pot of Gold

Why We Need a Sovereign Wealth Fund

Canada’s objective must be clear: sovereignty. If we can’t control our own destiny, someone else will. That’s not hyperbole—it’s the lesson of the last few years, whether it was “51st state” talk, Trump’s tariffs, or the global scramble for supply chains and critical technologies.

Sovereignty today is not just about borders and flags. It’s about control over data, communications, energy, food, healthcare, mobility, defense, and yes—money. These are not negotiable. A sovereign Canada must ensure that the businesses underpinning these areas are Canadian-owned and Canadian-financed. And that leads us to the heart of the problem: capital.

Canada’s Capital Formation Gap

Entrepreneurs will tell you: to build a business you need three things—capital, talent, and customers. Our policy debates tend to spread across all three, but today I want to laser in on capital.

Canada is terribly inefficient at capital formation. Aging demographics, large government deficits, high taxes, and unproductive capital trapped in housing make it very difficult for Canada to produce capital, especially for productive assets. Except for Alberta, which at least attempted it with the Heritage Fund, we simply don’t build pools of domestic capital at scale. Our pension funds, despite their global reputation, largely bypass Canadian entrepreneurs in favour of foreign assets. Venture and private equity funds struggle to raise at home and rely heavily on foreign LPs for scale capital. And our banks, while stable and conservative, typically do not provide the kind of long-term risk capital needed to build sovereign industries.

So what happens? Canadian innovators turn to foreign capital. That might sound fine until you remember that every country is suddenly rediscovering its own sovereignty. The U.S. is prioritizing “Buy American.” Europe is weaponizing regulation. China has long been playing its own state-backed capital game. Access to foreign capital will only get tougher.

If we cannot generate capital here, on our soil, our sovereignty is compromised.

The Case for a Canadian Sovereign Wealth Fund

That brings us to the question: should Canada create a Sovereign Wealth Fund (SWF), like Norway’s Government Pension Fund Global or Singapore’s Temasek and GIC?

The short answer: yes.

But we need to understand what that really means. A sovereign wealth fund is not a slush fund. Done properly, it is a professionally managed pool of assets, governed independently, with a dual purpose: to protect a nation’s sovereignty while generating long-term returns.

Canada already has pieces of this puzzle, but they’re scattered everywhere: BDC, EDC, SIF, CIB, NRC, SDTC (RIP), and countless others. Ottawa is not short on acronyms—it’s short on strategy. Many gaps and overlaps, misalignment, and competing interests makes it very hard to coordinate a cohesive strategy across so many groups.

This “Canada Fund” could operate as a strategic investor in our most sovereign industries, backing Canadian-owned companies, and generating returns that feed back into future opportunities. Instead of endless grants and subsidies (many of which go to non-Canadian companies), we could build permanent capital that compounds for decades. Importantly, it could allow for the disintermediation of the direct influence of foreign capital – direct foreign investment into our sovereign businesses is replaced with foreign investment into Canadian government bonds that back the Canada Fund.

Think about Alberta’s Heritage Fund. It was supposed to be exactly this—a long-term pool built from resource wealth. Unfortunately, successive governments raided it for short-term spending. Compare that to Norway, which stuck to the plan and now has the world’s largest SWF, worth more than $1.5 trillion. Norway has fewer people than Ontario, but more discipline than the whole of Canada.

We can do better.

Sources of Capital

So where would the money come from?

• Existing government assets and programs. Consolidate what we already have: federal stakes acquired through various programs or other initiatives.

• Resource revenues. Just as Alberta tried, we can allocate a portion of natural resource royalties at the federal level into the fund.

• Tax policy. Instead of giveaways and subsidies, shift towards equity participation—turning handouts into ownership.

• Partnership capital. Indigenous nations, who are increasingly building their own investment arms, could be invited as co-founders. Pension funds could also contribute capital, aligning their domestic mandate with the national interest. Maybe we can figure out a way to unlock our massive investment in residential property and convert an unproductive asset class into a productive one.

And critically, this fund should not operate as a grant dispenser. It should make investments—direct, fund-of-funds, and co-investments—just like Temasek or CDPQ (with its dual mandate to support economic development in Quebec). This model attracts additional private capital rather than crowding it out.

Where to Invest

We don’t need to spread the peanut butter thin. Focus is everything. The fund should prioritize sectors with direct sovereign importance:

• Energy and critical minerals

• Food and agriculture

• Data, communications, and AI

• Healthcare and biotech

• Mobility and transportation

• Defense and cybersecurity

This is not about picking corporate winners. It’s about supporting the industries without which Canada’s independence erodes.

Governance and Independence

Of course, the biggest risk is political interference. Canada’s track record here is… not great. If the sovereign wealth fund becomes just another political tool, we may as well stop before we start.

The solution is independent governance. Look at CDPQ, which operates at arm’s length from Quebec’s government, or the Canada Infrastructure Bank. The fund must be overseen by a professional, independent board including—but not controlled by—government representatives. Its mandate should be legislated, long-term, and difficult for future governments to tamper with.

The Fund’s goals should be twofold:

1. Support Canadian sovereignty by investing in key domestic industries.

2. Generate sustainable long-term returns by investing globally when appropriate.

The second point is important. Like Norway, the fund can invest abroad to diversify risk and generate steady returns. Sovereignty doesn’t mean economic isolation; it means ensuring that returns flow back to Canada and serve our long-term interests.

The Alternative: Dependence

Let me be blunt: without a domestic sovereign wealth fund, we might need to continue to rely on foreign capital. That means our sovereign industries—AI, healthcare, energy transition, critical infrastructure—will be shaped and controlled by others. We will be price-takers, not price-setters, in the industries that define the future.

And don’t expect U.S. or European investors to prioritize Canada’s interests over their own. Why would they? If you were managing capital in Washington, Berlin, or Beijing, your duty is to your citizens, not ours.

Canada cannot afford to keep outsourcing its future.

A Call to Action

This is not a partisan issue. It’s not about left or right. It’s about sovereignty. The question is whether Canada has the discipline and foresight to create a sovereign wealth fund, stick to it, and use it as the engine of long-term capital formation.

We don’t lack the talent. We don’t lack the entrepreneurs. We lack the capital. And the capital we do have is spread in silos, undermined by politics, or shipped abroad.

A Canadian Sovereign Wealth Fund would be a statement of maturity: that we take our sovereignty seriously enough to back it with hard capital.

The world is fragmenting. Sovereignty is being weaponized. Canada cannot keep drifting, dependent on foreign pools of money that may dry up tomorrow. We need our own pot, our own discipline, and our own strategy.

It’s time we stop pretending and start building

By John Ruffolo, Founder & Managing Partner, Maverix Private Equity