Canada’s new Ministry of Artificial Intelligence and Digital Innovation: What it means for Canadian innovators

The use of artificial intelligence (AI) has spread across the world — and many businesses are using this new technology for everything from guiding major decisions to reducing repetitive tasks. While AI offers valuable opportunities to enhance efficiency, increase productivity, and improve decision-making, many Canadian businesses have been slow to adopt this technology. 

To address this challenge, the Canadian government recently announced the creation of the new Ministry of Artificial Intelligence and Digital Innovation, led by Minister Evan Solomon. The purpose of the new platform is to build the infrastructure to support AI and accelerate adoption among Canadian businesses. Let’s discuss why this shift in approach toward AI and digital innovation matters — and the opportunities that this offers for Canadian tech leaders.

- Minister Evan Solomon

Why the creation of the Ministry matters

The creation of the Ministry of Artificial Intelligence and Digital Innovation marks a significant shift in how the federal government is approaching digital transformation, AI, and innovation policy. While Canada has been recognized as a leader in AI research and development, as seen in its role as Country of the Year at VivaTech 2025, the country has been slower to commercialize and use AI in day-to-day business operations.

The Ministry aims to increase the use of AI within the federal government to improve service delivery, reduce backlogs, and transform interactions with citizens. It will also focus on building Canadian-owned AI infrastructure and incentivizing businesses in the private sector to adopt AI.

The Ministry’s creation indicates that Canada is positioning itself as a global leader in both AI and digital transformation. Solomon has stated that he aims to take an approach focused on economic opportunity first, with a measured approach toward AI regulation. This marks a significant pivot from fragmented digital policy to a centralized, innovation-first approach that offers several opportunities for Canadian tech leaders.

What this might mean for Canadian tech businesses

New avenues for growth and global expansion

Canadian tech companies are already being showcased internationally and receiving recognition on the global stage. For example, Hypertec, a Canadian global leader in sustainable AI infrastructure, recently announced a $5 billion program to build data centres in Europe and reinvest $250 million in Quebec. Canadian technology companies can expect to receive more support for international partnerships, research and development, and commercialization with the creation of the Ministry of Artificial Intelligence and Digital Innovation. Other countries have recently formed similar government organizations, such as the United Arab Emirates (UAE)’s Ministry of State for Artificial Intelligence, Digital Economy, and Remote Work Applications.

According to a 2025 study by the Technology Resource Group (TRG), the UAE ranks as the second-best country in the world for AI due to its commitment to fostering AI adoption and innovation. The country’s strong performance in this space has led to the creation of startups and investments from industry leaders including Microsoft, Nvidia, and OpenAI.

The creation of Canada’s Ministry of Artificial Intelligence and Digital Innovation may help Canadian companies gain similar international investments and is a significant step towards promoting Canada’s global AI leadership.

A shift in regulatory tone

Solomon has stated that he won’t over-index on warnings and regulation around AI use. While the federal government won’t abandon regulation, the Ministry will instead prioritize privacy and data protection.

This stance shifts the focus from AI’s risks to its potential rewards and aims to focus on enabling AI innovation instead of stifling it. Historically, Canada has struggled to retain Canadian talent and intellectual property (IP) as many innovators move to other markets such as the U.S. — which offer more opportunities for innovation. Taking a lighter approach toward regulation and offering potential incentives to innovative companies may help keep Canadian talent and IP within the country.

Digital sovereignty and infrastructure

The federal government emphasizes the importance of building Canadian-owned AI infrastructure such as data centres or high-speed communication networks. This helps safeguard privacy, protect Canada’s economic sovereignty, and guarantees access to the large amounts of data generated and analyzed by AI.  

The Ministry will focus on the development of Canadian compute infrastructure and digital sovereignty. This may offer opportunities for Canadian tech startups that specialize in the cloud, chips, or AI tooling.  

What should Canadian tech leaders watch for?

AI is constantly evolving — and it is crucial to stay up to date with the latest changes to seize emerging opportunities. With the creation of the Ministry of Artificial Intelligence and Digital Innovation, Canadian tech leaders should watch for:

• Revisiting of previous AI legislation: The Trudeau-era bill on high-impact AI systems may return in a revised form.
• Funding and incentive programs: Canadian businesses are falling behind in AI adoption and use. To address this challenge, the Ministry may offer new initiatives to support AI adoption, especially for small- to medium-sized enterprises.
• Public trust and ethical AI: The Ministry is committed to the safe, trustworthy, and responsible use of AI. While Canadian regulation has previously taken a light touch, tech leaders can expect guidance on responsible AI to evolve in the future.

Take the next steps

At MNP, we see this as a pivotal moment for Canadian tech. The creation of the Ministry of Artificial Intelligence and Digital Innovation is more than symbolic — it is a signal that Canada is ready to lead the next wave of digital innovation. For startups and scale-ups, this is a time to stay informed, agile, and ambitious.

MNP is proud to support the Canadian tech industry and the companies striving to define, shape, and lead the use of AI. For more information on opportunities for Canadian tech companies, contact a member of our Technology, Media, and Telecommunications team.