Canada’s infrastructure gap: why spending alone won’t be enough

A new report finds the country must rethink how projects are planned, funded, and delivered to mobilize a US$4.7 trillion opportunity.

The report from PwC Canada finds that despite ranking fourth globally in annual infrastructure spending at US$145 billion, Canada invests just 6.6 per cent of GDP on infrastructure, well below the 7.4 per cent its high-performing peers invest. Closing that gap requires an additional US$34 billion a year by 2050.

But closing the gap is only part of the challenge. The report, Mobilizing Canada’s US$4.7T infrastructure opportunity, built on a new Oxford Economics forecast, highlights that how effectively Canada captures this opportunity will depend not just on how much it invests, but on how those investments come together. According to the report, realizing that opportunity requires a shift from silos to systems, moving from planning roads, power grids, digital networks, and community infrastructure as separate projects to building them as connected systems.

“Canada’s energy strategy, its defence commitments, its critical minerals potential, and its digital ambitions are being treated as separate conversations,” said Johanne Mullen, Partner, National Leader of Real Assets at PwC Canada. “They’re not. They’re one infrastructure challenge. Canada can exceed its US$4.7 trillion forecast or fall short of it. The difference will come down to the decisions being made now on how we plan, fund, and deliver together.”

The report identifies three interdependent shifts Canada can make to capture this opportunity:

1. From isolated assets to integrated systems: Multi-use infrastructure delivers broader economic value and attracts more diverse capital because cost and risk are shared across multiple users. This makes projects more investable at a time when public budgets alone cannot close the gap.
2. From traditional funding to shared capital structures: Canada’s fiscal position is constrained, making private capital essential. The report outlines approaches including blended public-private investment, and Indigenous communities participating as long-term economic partners through revenue sharing, expanded procurement, and equity ownership, supported by programs such as the Indigenous Loan Guarantee Program. These approaches are emerging but not yet the norm.
3. From legacy delivery to workforce readiness: Canada doesn’t produce enough tradespeople to meet current demand, let alone what’s ahead. The report highlights approaches such as Germany’s dual-track programs pairing professional degrees with trade certifications and Singapore’s dedicated technical institutes.

Capturing the infrastructure value

Resources (US$1.6T cumulative): Canada’s largest sector, encompassing infrastructure that supports the extraction, processing, and transportation of oil, gas, coal, metals and minerals. Growth is increasingly shaped by multi-use projects, driven by rising global demand, geopolitical shifts, and Canada’s position as a stable, reliable supplier.

Transportation (US$912B): The second-largest sector, projected to grow 48 per cent. While spending on roads and bridges dominates, significant investment is flowing into passenger rail expansion and freight corridors connecting commodity sources to global markets.

Power (US$605B): Projected to grow 57 per cent. Renewables lead at US$272 billion, with nuclear adding US$86 billion. Grid connections between provinces and territories remain fragmented, and Canada’s nuclear investment growth (11 per cent) trails the US (17 per cent).

Defence (389 per cent growth): Canada’s fastest-growing sector, driven by NATO commitments, Arctic security, and the country’s pledge of an additional 1.5 per cent of GDP for defence and security investments.

Digital (US$237B): Canada has natural advantages for data centres (land, water, renewable power, cold climate) yet is projected to trail the UK and Australia in cumulative data centre investment by 24–28 per cent.

“We’ve been tracking how value is moving across traditional sector boundaries, and infrastructure is where that shift becomes physical. The rails, grid connections, and digital infrastructure Canada builds over the next 25 years will either accelerate that transformation or hold it back. Mobilizing Canada’s US$4.7T infrastructure opportunity is more than an infrastructure report, it’s a reinvention roadmap for how Canada builds its economic future.” said Nochane Rousseau, National Managing Partner, Clients and Markets at PwC Canada.

Featured image: (DND)