Canada leads an initiative to create a global “defense bank” in cooperation with 10 countries economy

Canada said that it seeks, in cooperation with about 10 founding countries, to announce the establishment of the Defense, Security and Resilience Bank during the NATO summit scheduled for next week in Turkey, in a move aimed at providing low-cost financing to enhance the defense capabilities of allied countries.

Isabel Houdon, Canada’s chief negotiator in launching the initiative and CEO of the Canadian Business Development Bank, said that Ottawa has set the NATO summit as a deadline for announcing the list of founding members, noting that the initial list will likely include European countries alongside Canada.

The new bank aims to provide financing that may reach 100 billion pounds sterling (about 133 billion dollars) to support defense industries and the security infrastructure in allied countries, through a multilateral financing mechanism at a lower cost.

Houdon stressed that the announcement is still not guaranteed, as it depends on completing final negotiations with the allies, including determining the size of each country’s capital contributions, but she stressed that the initiative is gaining increasing momentum.

Last June, Canadian officials reported that the British government was holding talks with Ottawa about joining the Defense Bank, amid contacts between initiative officials and the British Ministries of Defense and Treasury.

Canadian High Commissioner to Britain Bill Blair said that former British Prime Minister Gordon Brown discussed the initiative directly with Canadian Prime Minister Mark Carney, adding that negotiations are still ongoing and that there is progress, despite the need for more work.

Some defense industrial circles in Britain view London’s participation in the bank as a potential tool to ease the pressures on financing defense spending, especially with the escalation of internal controversy over the level of funding allocated to the army.

Despite the growing momentum, Britain’s participation is still undecided, in light of reservations within the Treasury Ministry regarding the cost of joining, as reports indicated that the initial funding required from London may reach 870 million pounds sterling (about 1.16 billion dollars).

Fighter program

In parallel, Canada is examining the possibility of joining the Global Combat Aircraft Programme, which is a joint project between Britain, Japan and Italy to develop sixth-generation fighters by 2035.

Blair said that Ottawa is seriously considering potential participation in the program, noting that Canada has an advanced sector in the aviation industry, along with capabilities in technology, training and testing, as well as resources of vital minerals and safe supply chains that can support the project.

These talks come at a time when European defense programs are facing increasing pressure due to high development costs and the need to enhance military capabilities, amid fears of expanding security challenges and declining stability of the international system.