Wedoany.com Report-Nov. 6, Canada will establish a C$2-billion Critical Minerals Sovereign Fund to accelerate investment in strategic mining projects and strengthen national supply chains, Finance Minister François-Philippe Champagne announced on Tuesday in the 2025 federal Budget. The fund, managed by Natural Resources Canada, will provide equity investments, loan guarantees, and offtake agreements to advance critical minerals projects. An additional C$50 million will be allocated over five years to support the fund’s operation.

Alongside the sovereign fund, Ottawa will introduce a C$371.8-million First and Last Mile Fund to promote upstream and midstream development in critical minerals supply chains. This initiative will replace the existing Critical Minerals Infrastructure Fund and is expected to leverage up to C$1.5 billion in total support through 2029/30. The fund will help move near-term projects into production and finance clean energy and transport infrastructure connecting mine sites to processing facilities and markets.

The 2025 Budget also proposes expanding the Critical Mineral Exploration Tax Credit to include 12 additional minerals: bismuth, cesium, chromium, fluorspar, germanium, indium, manganese, molybdenum, niobium, tantalum, tin, and tungsten. This builds on the government’s Critical Minerals Strategy launched three years ago and aligns with Canada’s focus on securing supply chains through the Critical Minerals Production Alliance announced at the G7 Summit in Kananaskis, Alberta.

Industry groups welcomed the measures. The Mining Association of Canada (MAC) described the 2025 Budget as a “strong, comprehensive commitment” to improving the competitiveness of Canada’s mining sector. MAC president and CEO Pierre Gratton said: “Budget 2025 confirms the federal government’s unwavering commitment to the Critical Minerals Strategy released three years ago. These measures, taken together, send a powerful signal to the mining industry, global investors, and Canada’s allies that Canada is very serious about improving the competitiveness of its mining industry.” He added that the new sovereign and infrastructure funds, together with tax incentives and infrastructure support, “promise to usher in a new era in mining investment,” bringing benefits such as job creation, export growth, and stronger national sovereignty.

Key budget highlights also include a Productivity Super-Deduction allowing immediate write-offs for new capital investments, an extension of the Carbon Capture Utilisation and Storage Tax Credit full rates to 2035, and expansion of the Clean Technology Manufacturing Investment Tax Credit to cover polymetallic extraction and minerals like antimony, indium, gallium, germanium, and scandium. Additional measures include C$25 billion in new business facilitation capacity for Export Development Canada, C$10 billion in new funding for the Canada Infrastructure Bank, a C$1-billion Arctic Infrastructure Fund, and C$443 million to support processing technologies, joint projects with allies, and a national stockpiling program.

The Budget emphasizes that critical minerals are “central to Canada’s Climate Competitiveness Strategy,” linking resource development to national security, decarbonisation, and industrial growth. Canada’s mining sector currently contributes C$117 billion to GDP, representing 21% of total exports, and provides direct and indirect employment to 711,000 people, including many from Indigenous communities. Gratton concluded: “Today’s budget promises to create major opportunities for Indigenous Canadians and protect Canadian sovereignty for years to come. We urge the government to implement these proposals expeditiously.”