Canada needs a unified digital industrial strategy and a national digital competitiveness initiative for small and medium-sized businesses, according to a “roadmap” from the Information and Communications Technology Council (ICTC).

The country also needs to make talent a national strategy by advancing a “Future-Ready Workforce Strategy,” the not-for-profit ICTC says in its Roadmap for Canada’s Digital Economy to 2030.

“Canada is standing at a digital crossroads,” says the roadmap, co-written by Namir Anani (photo at left), ICTC president and CEO, and Erik Henningsmoen (photo at right), senior research and policy analyst at ICTC. “Unless Canada acts boldly and quickly, we risk sliding from being a leader in innovation to becoming a mere consumer in the technologies that will define the 21st century,” they say.

Canada’s digital economy already contributes more than $223 billion annually – over 10 percent of GDP – and employs 2.4 million Canadians, or 12 percent of the Canadian workforce. By 2030, this could grow to nearly $250 billion and 2.76 million jobs.

“But these gains are not guaranteed,” Anani and Henningsmoen warn. “The message is simple: the next five years will determine whether Canada becomes a digital leader or a follower.”

Canada currently ranks in the bottom half of Organisation for Economic Development and Co-operation for domestic compute capacity, ICTC’s roadmap notes.

“Without urgent investment in sovereign AI infrastructure, resilient semiconductor supply chains, and Canadian-owned cloud and data storage, we will remain dependent on foreign providers – vulnerable to supply chain shocks and geopolitical pressures.”

Canada also has an “innovation paradox” –  world-class in research but lagging in commercialization. Less than five percent of Canadian patents are commercialized domestically.

“Unless we reform innovation incentives, strengthen IP protections, and close the commercialization gap, Canadian discoveries will continue to benefit foreign economies more than our own,” the roadmap says.

Canada ranks 20th globally in digital competitiveness, and many SMEs face challenges in adopting advanced technologies including digital tools, commercializing research, and expanding into global markets.

AI adoption alone could boost Canada’s productivity by 1.5 percent annually over the next decade, according to the roadmap.

“Canada’s most valuable natural resource is not in the ground but in its people,” the roadmap notes. “Building a diverse, future-ready workforce must be treated as a national economic strategy.”

That means expanding digital and STEM (science, technology, engineering and mathematics) pathways for youth, modernizing credential recognition for skilled immigrants, and scaling up reskilling opportunities for workers at every career stage.

Rural and remote communities still experience uneven digital infrastructure, while gaps in data governance, trust and cybersecurity slow adoption. At the same time, shortages in high-demand tech roles risk limiting innovation, according to the roadmap.

“Addressing these barriers will be essential to ensuring digital transformation is inclusive, sustainable, and beneficial all of Canada,” Anani and Henningsmoen say.

The ICTC’s board of directors is calling on Canadian policymakers to act on five urgent priorities:

1. Invest in Sovereign Digital Infrastructure – Establish Canada’s strategic digital foundations by scaling domestic AI compute capacity, securing semiconductor resilience, and enforcing data and cloud sovereignty to protect national competitiveness and security.
2. Close the Commercialization Gap – Accelerate innovation-to-impact by modernizing scaling incentives, strengthening intellectual property protection regimes, and fostering homegrown commercialization pathways that keep Canadian innovations and talent anchored in Canada.
3. Accelerate SME Digital Adoption – Launch a National SME Digital Competitiveness Initiative to accelerate adoption of AI-driven solutions, advanced analytics and digital productivity tools, enabling Canadian SMEs to compete and scale globally.
4. Make Talent a National Strategy – Advance a Future-Ready Workforce Strategy by scaling STEM and digital education pipelines, modernizing credentialing frameworks for newcomers, and embedding inclusive talent development to leverage Canada’s full human capital potential.
5. Advance a Unified Digital Industrial Strategy – Forge a National Digital Competitiveness Agenda that integrates innovation, infrastructure, sustainability, and digital trust under a unified strategy, positioning Canada alongside other global leaders.

Strengthening Canada’s digital advantage

The ICTC’s roadmap outlines nine strategic recommendations to strengthen Canada’s digital advantage by 2030:

1. Enable a competitive landscape for Canada’s digital economy.

This should encompass initiatives for policy harmonization, regulatory sandboxes, and effective “smart” regulations tailored to emerging technologies, in addition to enhancing market access and curbing monopolistic practices in key Canadian sectors.

Also, the country should increase funding for venture capital and technology incubators, especially in underserved regions, to develop strong regional startup ecosystems to bolster innovation and support new businesses.

        2. Create a robust digital infrastructure for Canada. 

The roadmap points out that Canada falls short in development domestic compute infrastructure. A shortage of high-end AI compute may prevent Canada from fully leveraging its current strengths in AI research and its solid talent pool in the field.

To engage in the next wave of digital technological advancement, Canada requires a robust digital infrastructure to leverage emerging technologies such as AI, quantum computing, and 5G/6G networks.

[Editor’s note: Federal Budget 2025, which came out after the ICTC’s report included a $925.6-million investment over five years to fund sovereign public AI infrastructure. The budget also proposed a new Office of Digital Transformation to lead the adoption of AI and other new technologies across government].

Canada also must also achieve its long-term goal of nationwide high-speed internet coverage by 2030 for all Canadians and establish a strong and extensive cellular network.

Additionally, Canada should bolster its cybersecurity defenses and establish the technological infrastructure for digital trust and identification systems.

Research by the McKinsey Global Institute across seven national economies predicts that a widely adopted digital ID could raise a country’s national GDP by up to three percent in advanced economies by 2030.

As for cybersecurity, according to the Canadian Cyber Security Network’s State of Cybersecurity in Canada Report 2025, Canada is facing a significant shortage of cybersecurity talent and lacks an adequate education and training pipeline for prospective cybersecurity professionals.

Also essential is securing access and maintaining the national semiconductor supply chain, which supports all digital technology. “Without a secure semiconductor supply chain, including access to the chips required for advanced computing applications, Canada will lack the hardware essential for developing, adopting, and implementing cutting-edge digital technologies, such as AI and quantum computing.”

        3. Bolster innovation and commercialization in Canada.

Catalyzing Canada’s research capabilities requires reforming business R&D incentives, “modernizing” university technology transfer offices, better utilizing international trade agreements, enhancing IP protections, and improving research security while safeguarding IP against theft.

The Scientific Research and Experimental Development (SR&ED) tax incentives program should be enhanced to encourage innovation in strategic sectors of the digital economy, including AI, quantum computing, life sciences, and advanced energy solutions (such as green hydrogen, biofuels, small modular reactors).

“The current SR&ED program also does not provide incentives for Canadian companies to commercialize their IP or scale their operations in Canada,” the roadmap notes.

        4. Enhance digital economy policy and governance frameworks.

This should include developing ethical frameworks for AI and quantum technologies to ensure interoperability and trust in collaboration with strong and likeminded economies such as the U.S. and Europe.

Regulatory sandboxes – followed by enacting smart regulations – should be applied on an experimental basis to emerging technologies within limited timeframes to encourage innovation in novel digital technologies

        5. Develop Canada’s digital talent.

National programs should be established for upskilling and reskilling, with a focus on digital skills for workers displaced by automation, market shifts, interruptions to market access, and other economic disruptions.

Streamlining is required of pathways for international tech talent and development of incentives to retain internationally educated professionals, along with providing on-ramps to underrepresented groups, including women and Indigenous peoples.

Developing an industrial strategy for Canada’s digital future

6. Boost digital technology adoption for Canadian businesses.

Grants, tax credits, and technical assistance should be provided to assist SMEs in enhancing their knowledge and adopting advanced digital technologies.

A revised version of the Canada Digital Adoption Program – which ended in 2024 due to insufficient interest from Canadian businesses –  that addresses the shortcomings identified in the original program and is more adaptable to meet the digitalization needs of Canadian SMEs could help bridge this significant gap in the adoption of digital technology among Canada’s SMEs.

Subsidize adoption of AI-driven productivity tools in key industries. According to a 2024 study by Accenture, the adoption of generative AI tools in Canadian workplaces could increase productivity by eight percent and save the average Canadian worker 125 hours annually.

        7. Develop an industrial strategy for Canada’s digital future.

With extensive reserves of critical minerals, an abundance of energy sources, and a leading role in clean technology innovation, Canada is ideally positioned to spearhead the global energy transition and the expansion of advanced computing and data processing infrastructure.

This encompasses maintaining and advancing the nation’s unparalleled position in the development and deployment of carbon capture, utilization, and storage technology.

The strategy also should enhance agricultural productivity in Canada, mitigate risks and strengthen the nation’s food security by promoting innovation and the adoption of AI technologies for precision agriculture applications.

In addition, the strategy should address improving Canada’s health care system, the roadmap says.

Research by the Fraser Institute compares various high-income universal health care systems to Canada’s and reveals that, despite being among the top third of health care spenders, Canada ranks among the lowest for access to doctors and hospital beds, the availability of advanced medical technology such as MRI machines and CT scanners, and wait times for specialist care.

By 2028, Canada is projected to encounter a shortage of 44,000 physicians, with 72 percent of this deficit consisting of family doctors, who serve as the primary point of access to the healthcare system.

“Adopting digital technologies, many of which are developed by Canadian health care technologists and health-tech entrepreneurs, could significantly strengthen Canada’s universal healthcare system and enhance access to healthcare for Canadians.”

        8. Accelerate sustainable development for Canada’s digital future:

• Incentivize the development and adoption of sustainable energy solutions, such as green hydrogen, biofuels, and nuclear energy, including small modular reactors.
• Promote AI-enabled energy management systems to improve efficiency, boost yield, and lower industrial emissions.
• Encourage digital solutions that minimize waste and enhance resource efficiency.

        9. Earn public trust and promote citizen engagement.

• Strengthen efforts to combat misinformation and disinformation by raising public awareness and implementing regulatory oversight.
• Ensure that digital services prioritize the privacy and security of citizen ownership and sovereignty over personal data.

To ensure the most sensitive data stored on Canadian servers remains within Canada during digital transit, critical Internet exchange points should continue to be located within Canada. This will help promote data sovereignty and avoid transiting sensitive and protected data outside of Canadian jurisdiction and legal protection.

Together, these actions form a coordinated national approach to unlock the full potential of Canada’s digital economy, enhance productivity and resilience, “and position the country as a global leader over the coming years,” the ICTC’s roadmap says.  

“The digital economy offers a tremendous opportunity for Canada to achieve significant and rapid gains in productivity, economic prosperity, scientific and technological advancement, and global standing,” the roadmap says. “Canada must cultivate a viable digital future for itself.”

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