Mr. Chair and members of the committee, thank you for the invitation. It's my sincere pleasure to appear in front of this committee today. I'm a professor at Royal Roads University in Victoria. I do research and publish on issues related to energy, geopolitics and international trade.
Canada has an abundance of strategic resources that the world, especially the Indo-Pacific region, needs to help develop and sustain their economies. The Indo-Pacific region, driven by continued economic and population growth, will lead global demand for energy and critical minerals in the coming decades. According to the International Energy Agency, the region will account for approximately 60% of a global growth in energy demand by 2040, which will require more than $1 trillion U.S. in annual energy infrastructure investment.
In my published work, I define strategic resources as including Canada's energy resources, such as fossil fuels and uranium, as well as critical minerals, such as rare earth elements. I say that critical minerals are strategic, because they're relatively scarce, located only in certain locations, essential to a modern economy and integral to the energy transition. Access to critical mineral resources is a national security question for many countries and is increasingly vital to economic growth, peace and security.
We need to recognize there are risks to the stability and security of strategic resource supply chains. In the case of critical minerals, limited global supplies, the digital revolution and decarbonization efforts are driving resource scarcity and thus competition to secure uninterrupted access to CRMs. The principal risk is disruption of supplies, whether through shortages, embargoes, trade wars, conflicts or, as seen more recently, global pandemics.
In addition to resource competition, the use of market power as a tool of economic leverage can also be a source of risk. In the past, China has demonstrated a willingness to use its near monopoly over processed rare earth elements as political leverage against countries with whom it has disagreements. In 2010, China cut off Japan from key rare earth supplies in response to a territorial dispute over the Senkaku, or Diaoyu Islands. As well, in May 2019, Chinese president Xi Jinping visited one of China's rare earths magnet plants in a thinly veiled warning to the United States over escalating trade tensions.
Chinese economic strategy documents have continued to discuss leveraging its market power over rare earths in response to geopolitical disputes. Canada and our partners therefore need to prioritize efforts to develop alternative sources and bring them into production as soon as possible.
I'm encouraged by the efforts of the federal and provincial governments to develop a critical minerals strategy, compile a critical minerals list, and enter into agreements with key allies and partners such as the United States and Japan. Developing a viable supply chain for critical minerals in Canada will be the first priority. Ultimately, Canada must also have a strategy in place to leverage our capabilities and resource endowments to forge closer economic, security and political relations with important regions of the world.
It is manifestly in Canada's interest to support the economic and regional security of our partners and allies, and by that I mean those that uphold rules-based international order in the Indo-Pacific region, including Japan, South Korea, Australia, India and others. Canada needs to be well positioned to meet the growing demand for energy and other strategic resources, and to establish a reputation as a stable and reliable supplier and partner to the region. Canada's stake in the preservation of peace and stability in the Indo-Pacific region is significant because our future prosperity will increasingly depend on stable trade, and the political and security relationships we have there. Critical minerals can be an important asset for Canada in this effort.
Canada's economic future depends, in large part, on how we position ourselves to deal with the opportunities as well as the challenges posed in the Indo-Pacific region. It's my hope that federal and provincial governments will work towards coordinating their critical mineral strategies within the overall framework of a broader Indo-Pacific strategy, which I understand is under development now within Global Affairs. It will be important to leverage the benefits of Canada's critical mineral capabilities and resources in order to help advance Canada's broader interests, as well as support economic development, environmental sustainability and security in this important region.
Thank you very much.