Canada badly needs the productivity gains the technology sector may offer, but only if we take the right approach to three key theatres of action: data centre investments, public procurements, and trade policy.
in Domestic Policy, AI, Technology and Innovation, Latest News, In the Media, Peter Copeland
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This article originally appeared in The Hill Times.
By Peter Copeland and Lawrence Zhang, October 7, 2026
Sovereignty is back on the agenda, understandably and rightly in an era of resurgent great power politics. When global investors gathered for the Canada Investment Summit this September, the government framed the event around trust and said that Canada should focus on “what we can control.”
That need not mean an unrealistic attempt to diversify away from geography, or a conception of sovereignty that equates control with Canadian ownership. Properly understood, “what we can control” means using Canada’s leverage where it works and securing the systems Canadians depend on. That would be a genuinely “elbows up” approach—protecting our space, rather than swinging indiscriminately.
Technology is an obvious place to apply this principle. Canada badly needs the productivity gains the technology sector may offer, but only if we take the right approach to three key theatres of action: data centre investments, public procurements, and trade policy.
Sovereignty should mean freedom of action, the practical capacity to make decisions, protect critical assets, withstand coercion, and change suppliers when necessary. It does not follow that sovereignty and security require Canadian ownership throughout the technology stack.
Bell’s Saskatchewan data centre investment is a great example of what this looks like in practice. It has been framed as Canadian data sovereignty in action, and in one respect it is: a Canadian firm is putting $1.7-billion into Canadian infrastructure without Ottawa guaranteeing it customers. But the project runs on Nvidia hardware, and American tenants like Cerebras and CoreWeave. Canadian ownership also does not, by itself, put Bell or Cohere, whose models will run there, beyond the long arm of American law enforcement. Any firm with operations and customers in the United States can be compelled by American courts regardless of its nationality, and Canada applies the same principle: an Ontario court has ordered OVHcloud, a French provider, to hand over data stored in Europe. What protects the data is who holds the encryption keys, and what the contracts require.
This is an important lesson for Ottawa’s forthcoming sovereign-cloud procurement where the early signals lean towards prioritizing Canadian-owned and controlled cloud providers. Ownership requirements in procurement subtract bidders, which is an easy way to pay more for the same service, and it adds no additional control that well-written terms cannot. Ottawa can favour Canadian presence and investment through procurement scoring without excluding foreign competitors outright. Domestic providers would win where they can realistically compete and would have to stay competitive to keep the work.
The controls that matter for sovereignty can be written into any contract, regardless of nationality. Customer-held encryption keys ensure cloud providers served with a foreign court order have nothing readable to hand over even if they wanted to comply. Providers can be required to notify the government of foreign legal demands and contest them where law allows, to submit to audits, and to agree up front on what it costs and processes for moving the data to another provider. Critical systems should also have redundancy across providers so that an outage like the Amazon Web Services (AWS) failure that took down banks and airlines in October 2025 does not become a national one. These tools address the actual vulnerabilities—foreign access, contract lock-in, and service failure—more directly.
The trade talks with Washington, D.C., are the other place this definitions matters. Canada is retaliating, and as the smaller economy, it must choose its weapons carefully by leverage rather than emotional satisfaction. American cloud firms will be a tempting target since excluding them can be sold as retaliation, Buy Canadian policy, and digital sovereignty all at once. It would be a bad trade. Washington has already named Canada’s cloud sovereignty push as a trade irritant. Losing federal business would hurt AWS or Microsoft Azure, but they would absorb it. A Canadian software firm whose growth plan runs through American government contracts has no such cushion since, for that firm, losing access means the plan fails.
Canada should not blindly trust the Amazons, Microsofts, and Googles of the world. But customer-held keys, audit rights, exit terms, and redundancy would give Canada that control without adding another casualty to a trade dispute with the United States. In the digital economy, sovereignty by control will usually serve Canada better than sovereignty by passport.
Peter Copeland is (acting) director of domestic policy at the Macdonald-Laurier Institute.
Lawrence Zhang is head of policy for the Centre for Canadian Innovation and Competitiveness at the Information Technology and Innovation Foundation.
