Canada needs to rethink infrastructure planning, funding, and delivery, says PwC
Canada must rethink how infrastructure projects are planned, funded, and delivered, according to a recent PwC report.
The report – “Mobilizing Canada’s US$4.7T infrastructure opportunity” – is built on forecasting from Oxford Economics that projects the country will have a cumulative infrastructure spend of US$4.7 trillion between 2024 and 2050.
Although Canada ranks fourth in annual infrastructure spend at US$145 billion, that represents only 6.6% of GDP – significantly below the 7.4% that high-performing peers invest. Closing the gap will require an additional US$34 billion annually by 2050.
PwC says that spending more money is only one piece of the puzzle. To realize the US$4.7T opportunity, Canada will also have to evolve its approach to major infrastructure projects. That means moving from planning roads, grids, 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. They’re not. They’re one infrastructure challenge,” said Johanne Mullen, partner, national leader of real assets at PwC Canada. “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 highlights three changes Canada can make to meet or exceed the forecast.
The first is planning for integrated, multi-use infrastructure. This makes projects more investable to private capital and delivers broader economic value.
The second is seeking out public-private investment arrangements – because PwC says that public budgets alone cannot close the gap.
Third, Canada has a shortfall of tradespeople, and approaches such as Germany’s dual-track programs pairing professional degrees with trade certifications and Singapore’s dedicated technical institutes could help clear the hurdle.
Resources are Canada’s largest sector by projected infrastructure spending, at US$1.6T through 2050. Growth in extraction, processing, and transport of oil, gas, and minerals will be driven by global demand and geopolitical shifts.
Transportation is the second-largest sector, at US$912B, with projected growth of 48%. Spending will be dominated by roads and bridges, but significant investment will flow into passenger rail expansion.
Next is power at US$605B, at growth of 57%. Renewables – including Canadian standby hydroelectric – will represent US$272B, with nuclear accounting for US$86B. Canada’s nuclear growth is expected to trail the US at 11% versus 17%.
Defence will be by far the fastest grower at 387%, driven by Nato commitments and Arctic security pressures.
Digital will represent US$237B, with Canada projected to trail UK and Australia in cumulative data centre investment by 24%-28%.
“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.
