Foreign Affairs Committee on Oct. 23rd, 2025

[Rob Oliphant, Liberal, Don Valley West, ON]

Thank you. I'm still struggling that it could be both/and, because it may not be a challenge to our sovereignty which is, I think, a working definition—I'm going to maybe have our analysts work a little bit more on definitions of sovereignty, that's a heads-up—but a challenge to the defence and security of our territory of which we are sovereign.

I'm trying to figure that out, because there isn't a challenge to our sovereignty, I agree, at least generically, about the Arctic. Maybe there is a challenge to our whole country, but there are challenges for us with respect to what is an Arctic nation, where Arctic nations should engage co-operatively and where we should have absolute authority over what we do in what we believe to be our territory.

Am I getting close to this?

Challenge me. Push me back.

[David Perry]

I think the key issue is whether or not we can enforce what we want to happen in the place that we call our own. That's going to require significant investment and the capacity to do that. We have underinvested for a long time in many different apparatus of the federal government that enable us to respond from a pollution prevention point of view, search and rescue as well as core defence and security. I think the best route to ensure that we have confidence is for us set the terms for what happens in the Canadian Arctic and ensure that we have the means to do so.

[The Chair, Liberal, Ahmed Hussen]

Thank you very much.

Mr. Simard, you have the floor for six minutes.

[Mario Simard, Bloc, Jonquière, QC]

Thank you very much, Mr. Chair.

Mr. Fergusson, to make sure I understand, I'd like to go back to what you said in your presentation.

You talked about Arctic security, and you said that the diplomatic side of things has been neglected.

I'd like to hear some examples of what you mean when you say the diplomatic side of things has been neglected in the Arctic.

[James Fergusson]

The core example I would give you is in the context of the Russian invasion of Ukraine in February 2022. We shut it all down with the Russians, and there were policies that we instituted, and that the United States and our allies instituted, basically to shut all this down. The issue for me is why we shut all this down, although, the Coast Guard forum is still in place, and that's important, not least of all given our limited resources and the American limited resources in the Arctic relative to the Russian capabilities, which we might need as the Arctic opens up further.

That's the problem. We neglected this. We allowed that conflict in eastern Europe to colour everything we did. I understand the politics of all this, but there is still an important need for us to engage them.

For example, in the scientific world, in terms of climate change and permafrost warning, their scientists have important information that we need to know about, and we need to exchange with them. However, under the current situation, we're not doing that. That's really problematic for us. You have to ask yourself, at the end of the day, where the Arctic sits relative to the areas of confrontation or conflict we have with the Russians or even with the Chinese. They're really not in the Arctic.

The Arctic should be understood as a zone of co-operation because we all have common interests in the Arctic. If we don't do this, then what the Arctic potentially becomes, unintentionally, is a spark, which is a road we don't want to go down. It requires bold leadership, and unfortunately, we have had no bold leadership, for over a decade, on how to manage this.

[Mario Simard, Bloc, Jonquière, QC]

Thank you very much.

Your answer makes me think of what a witness said to the committee a few weeks ago. He spoke about gaining a solid grasp, which we don't necessarily have, of the threats in the Arctic, including melting ice and climate change.

This witness, whose name I don't remember, told us that it wasn't very likely that navigating in Arctic waters would be possible even though the ice is melting, because it remains a very hostile environment for all navigation. Therefore, we must be careful about planning development thinking that there are navigable routes in the Arctic due to the melting ice.

I don't know if you have any information on this. Do you wish to comment?

[James Fergusson]

The general understanding is that, as the Arctic ice cap starts to melt further and as you get more first-year ice rather than permanent ice, the navigable route is going to be the northern route, or the Russian route, to put it bluntly. Due to the rotation of the earth, the Northwest Passage is a problem because ice builds and comes into that passage. Therefore, we want to know.

This then relates to issues surrounding the UN Convention on the Law of the Sea, on the Arctic continental shelf issues. This needs to be managed, with the Russians in particular, regarding how we understand our legitimate jurisdictions relative to international law.

I would also add that, as far as I understand this, the Russians have been religious in devoting or committing themselves to proper scientific research with regard to the issues of the continental shelf in the Arctic.

We have an interest, though, because nothing sits in an ocean in one place. Given the rotation of the earth—as I mentioned about the Arctic ice moving into the Northwest Passage—if you have a disaster in the Russian passage, where is that going to go? Well, it's going to move, and it's going to move to us. That's a vital area, then, where we need to co-operate with the Russians. We have common interests with them. Why wouldn't we want to exploit those?

[Mario Simard, Bloc, Jonquière, QC]

Thank you very much, Dr. Fergusson. That's very enlightening.

Mr. Perry, in your presentation, you talked about the need to maintain funding for defence initiatives. You are surely aware, as I am, that the government intends to increase its defence spending to 5% of GDP, which would be done through infrastructure spending, particularly the infrastructure needed for critical minerals.

Since there are a lot of critical minerals in the north, do you find the government's proposed strategy valuable and promising?

[David Perry]

I do think it is promising. I think it will become more promising the closer we get to actually being able to meaningfully extract them in larger quantities and to process them usefully.

In the context of our discussions with NATO and that additional 1.5% that would go beyond the 3.5% target on core defence spending to an overall target of 5%, I think that, as best as I can tell, that 1.5% remains still fairly vaguely defined. Perhaps there's an ability for Canada, as part of our participation in the alliance, to help shape what that means.

My best guess, though, would be that we would only be able to count some of the investments, which, to my mind, we should be making for our own national reasons. We have products that are valuable globally, and we should exploit them as much as we can for our own national benefit—economic, social and otherwise. However, it's only to the extent that this exploitation can help tangibly connect with a defence supply chain and help produce defence capability that we can consider them as part of that 1.5% to take us to that 5% overall.

[The Chair, Liberal, Ahmed Hussen]

Thank you very much.

Next, we'll go to MP Tamara Kronis.

You have five minutes.

[Tamara Kronis, Conservative, Nanaimo—Ladysmith, BC]

Thank you very much.

This has been a fascinating discussion, and I've very grateful to the witnesses for their insights.

Dr. Perry, you've touched on a number of points. When we think about China, Russia and the United States as we move from a clear American homogeneity to a more multipolar world, depending on who you talk to, we think of China as being far to the west and of Russia as being far to the east. When we think about the United States, we think about our southern border. In the Arctic, they're really all right there. They are our neighbours, and they are right across the ocean.

I'm wondering if you can elaborate a little bit on how the defence and security requirements change when we look at these countries from our northern border instead of from our southern border, and on what we need to do.

[David Perry]

To pick up on a point that you mentioned, I'll say that I think that Canada actually has a lot that we can potentially draw on from on our American neighbours in Alaska, who have already fielded there—they're in a similar climate—a lot of the same capabilities that we're looking to acquire. I think there's a lot that we could draw on there.

The basic issue that we need to be aware of is this: Wherever you want to look at these potential threats on a map, because of the geography and transpolar routes, they're more likely to be presenting a military challenge to North America over the pole. It's the same reason that, when you fly east or west, you tend to go through parts of the Arctic. It's the same flight path that a missile would take, more or less, because it is faster and is a more direct route. Irrespective of what latitude most of China is on, if it wants to take military action towards North America, it is likely to come through the Arctic. The same thing applies to Russia.

Then, because their Arctic is important for the Russian economy—the Russians are really deploying a lot of assets there; they're making significant investments there—they've positioned there a lot of what are, for them, strategic forces that could be used anywhere in the world. They are just already positioned in their north, which further increases the likelihood that they might be used in a way that would come over the pole and, therefore, through Canadian Arctic territory.

[Tamara Kronis, Conservative, Nanaimo—Ladysmith, BC]

I'll just follow up on that.

In your opening remarks, you talked about Canada being behind. How far behind are we? How far behind are we on critical minerals? How far behind are we on mining? How far behind are we in terms of our defence capabilities? If you have any insight on what we need to do to speed it up, I'd love to hear it.

[David Perry]

On the Russian front, in particular, they started reinvesting in a lot of these capabilities with northern application close to 20 years ago. I think that maybe waiting five years or 10 years to be certain that this was a trajectory that was certain to be a problem.... We could have maybe had a little leeway for about half the time that it's taken us to really kick into gear to start responding, but I think, at this point, we're well overdue.

In terms of things that we could do, I think there are a number. Part of it, as we discussed earlier, is that we have a tendency to be extraordinarily Canadian and to want to have a competitive environment in all circumstances. I think there are a lot of environments in which it doesn't make any sense to create a competition just for the sake of having one, so making more decisions on a sole-source basis would be smart.

There are a number of other things we should do. We're trying to do a lot at the same time. We're undertaking the most comprehensive military modernization effort since we rearmed for the Korean War, and I think we're doing so with a Government of Canada administrative apparatus and bureaucracy that's a little heavier than it was in the early 1950s. Until we can change that, I think we need to make priorities. I think one of the priorities that we should make is to focus our efforts on Arctic capability, both for our own reasons and because I think it's an opportunity to have a constructive discussion with the U.S. administration and to do something that they want.

[Tamara Kronis, Conservative, Nanaimo—Ladysmith, BC]

I would just like to get one more formal question in there, which is in terms of flashpoints. One of the things that we really talk about a lot off the coast of British Columbia is fish and ocean warming. The fish are moving north.

There's fish, there's trade, there's defence and there's land. Where do you think the flashpoints are most likely to happen in terms of the current configuration?

[David Perry]

It's hard to predict where a specific flashpoint would occur. The key thing is that we need to focus on what would be the most impactful threats.

Concerns over fishing would have to take a number of different steps to become concerning. The most recent disputes we've had over fishing have been with key allies, so the likelihood that those evolve into something we don't want to see happen is perhaps less, depending on who is actually doing the fishing.

Having said that, a number of countries—China in particular—employ non-state assets, and fishing vessels in particular, in ways that make it difficult to figure out whether or not those vessels are acting independently or acting as an arm of the Chinese government, in a sense.

We need to be mindful of those things, but I think the core priority should be focused on conventional military threats, because we have so far to go in terms of adequately preparing for our own defence.

Thank you.

[The Chair, Liberal, Ahmed Hussen]

Mr. Brendan Hanley, member of Parliament, welcome to the committee. You have five minutes for questions.

[Brendan Hanley, Liberal, Yukon, YT]

Thank you, Mr. Chair.

Thank you, committee members and guests, for the opportunity to be here for a short time.

As noted, I'm not a regular member of this committee, but this is a topic of some importance to me as a member of Parliament for the Yukon Territory.

I want to follow up on my colleague, Mr. Oliphant, in searching for some clarity on sovereignty. I must say that I'm a little uneasy with the comment that we need to put that aside or that there is no sovereignty issue.

When I think of the history of colonialism and displacement in Canada, but particularly in the three northern territories, I think we really need to continue to look to the expertise on the ground for the definition of sovereignty. To me and to many in the north, that relates to governance and ownership. Who's governing? What are the threats? Who needs to know? How are threats communicated and what are the lines of communication? We have had some issues where, for instance, self-governing first nations chiefs do not have information on what is actually a potential threat on the territories.

Dr. Perry, I know that you have extensive expertise in the area of diplomacy, security and global governance. I wonder if you could start, maybe briefly, by describing how, from a federal point of view, we can best interact and collaborate, even when we're talking about procurement and bolstering infrastructure—defence, security, defence infrastructure—with self-governing modern treaty nations, but also, of course, with territorial and provincial governments.

[David Perry]

Thank you.

I'd say it's to recognize that there is an importance to engage with all of that stakeholder base, all those communities. I think we've been trying to move in that direction in a number of different respects. I think we need to figure out a way do as much as is required, as quickly as possible.

I don't know that we've struck that same balance. I take a bit of a cue from some of the discussions about major projects, recognizing that there is an importance in engaging with the relevant stakeholders and then doing the regulatory review. We just need to figure out a way to do it much faster than we have in the past.

That's a question of engaging however many hundred more staff and quadrupling their travel budget to go and meet with enough people, but how do we do that in an effective and relevant time frame? I think that from my vantage point, I come back to all of that. While those are valuable objectives, we need to be thinking about doing that towards the objective of meaningfully bolstering our actual security and defence arrangements.

[Brendan Hanley, Liberal, Yukon, YT]

Thank you.

I don't think you will find any disagreement from the territories on that. I have a couple of examples.

As you may know, the Yukon established the Yukon Arctic Security Advisory Council under former premier Ranj Pillai's leadership. Also, the Yukon First Nations last year hosted the Defence and Security Conference. There is an Arctic Summit 2026 being prepared, which is called “Securing Sovereignty and Investment”. What I hear repeatedly is leaders, community members and civilians saying, “we're here to help”.

In terms of one example, actually, I note that you contribute to the Canadian Naval Review. You may know that there has been an exploration of the feasibility of a naval reserve in the Yukon. A decision still has to be made.

They've been here all summer in the Yukon. It's been really great to meet with them.

Noting the lack of human resources in CAF, how important would something like a naval reserve in the Yukon be? How can that help contribute to our human resources around the country?

[David Perry]

The possibility of taking initiatives like that or, to connect it more broadly with how we engage the Canadian Ranger communities, which is the other major reserve component of that, is really a question of what we train and equip them to actually do and how connected they are with the rest of the national security and defence apparatus.

In the past, we haven't really provided as many of those points of connection, enough of the training or enough of the equipment as we could have. With the rangers on their own, I think there's a lot of asymmetry, in my understanding, between the different ranger patrols. Some of them have very different skill sets and some of them are much more connected with more of that conventional apparatus.

Standardizing some of that and improving the training, the equipment and the connectivity is a significant asset. If you could take a model like the naval reserve initiative, the real key is what you can get them to meaningfully be able to contribute. Just creating an organization and having a certain number of people be part of it will create a certain benefit, but if we can really give it utility and have it be well connected, well equipped and well trained, that's where we're going to get the maximum benefit.

[The Chair, Liberal, Ahmed Hussen]

Thank you very much.

We will go next to Monsieur Simard.

Mr. Simard, you have the floor for two and a half minutes.

[Mario Simard, Bloc, Jonquière, QC]

Thank you very much, Mr. Chair.

I'd like to take advantage of the expertise of our two witnesses to ask them a question.

There is increasing talk of a willingness among the countries in the North Atlantic Treaty Organization, or NATO, to establish a list of strategic minerals to which a base price would be applied to allow mining projects to get off the ground in Canada, as they are in the other NATO countries. As we know, China and Russia are engaging in what appears to be dumping on the market and they're managing to control prices.

Rare earths are a fundamental element in the energy transition, but also in defence and in new technologies. In your opinion, is it realistic to envision a base price for critical minerals in the short term?

Mr. Perry, I invite you to answer first.

[David Perry]

That's where Canada has a unique natural advantage because those are our natural resources. I think we should really seriously look at what, perhaps uniquely among some of the NATO countries, Canada can provide by virtue of those natural resource holdings.

I think we should help to create mechanisms that would change some of the price structures that China uses to make it much more difficult for western countries to create their own sources of supply on a sustainable basis.

The real added value that we can provide is getting those resources out of the ground and processed. That might be where we can carve out a particularly value-added contribution to the NATO alliance because most of the other allies don't have the same kinds of natural resource deposits that we do.

The real key is not to just have the deposits, but to get them meaningfully into defence supply chains. I think there's a long way to go there. I'm hoping that part of what comes forward with the defence industrial strategy would include initiatives around critical minerals. We're seeing investments in this by other NATO allies, like the United States in Canadian companies. I think the Government of Canada can take a significant role in trying to create the right kind of market conditions to get much more critical mineral extraction and processing happening here in this country.

[Mario Simard, Bloc, Jonquière, QC]

Thank you.

Dr. Fergusson, do you want to add anything on the same topic?