Canada stands at a crossroads in the North American critical minerals economy.
As the United States-Mexico-Canada Agreement (USMCA) renegotiations gain momentum ahead of the pact’s formal review, Ottawa faces a strategic decision: whether to defend the existing model of resource sovereignty or adopt one that shapes the conduct of Canadian firms globally.
Critical minerals form the backbone of North America’s energy transition. The question is whether Canada can influence the terms of that transition – or simply react to decisions made in boardrooms around the world.
The pending merger of British mining giant Anglo American and Vancouver-based Teck Resources underscores this reality: a Canadian mining champion now faces a decision that will be shaped as much by foreign regulators as by Ottawa.
A new theory of sovereignty
For years, Canada has tried to move beyond its traditional role as a raw-material exporter. The former Trudeau government laid out an ambitious strategy focused on upstream-to-downstream value chains, and the Carney government has continued on this trajectory: more processing, more manufacturing, more integration with allied industrial policy. But pursuing these goals requires more than funding and incentives.
It requires a theory of sovereignty that matches the realities of a globalized critical minerals system: one in which Canadian firms operate mines in Latin America, Africa and Australia, but that also opens the door for foreign regulators to influence the fate of Canadian companies.
This ambition now rests alongside a proposed foreign takeover of one of Canada’s most significant mining firms – a contrast that raises legitimate questions about policy coherence at a time when Ottawa is investing billions in mining sovereignty.
The role of the USMCA
The USMCA sits at the centre of this challenge. For Canada, the USMCA increasingly acts as the region’s de facto governance framework for critical minerals security. It establishes non-discrimination, transparency and investment standards across North America – conditions essential for the kind of integrated supply chains Canada wants. But it also limits what Canada can do unilaterally. No clause of the agreement gives Ottawa the power to block a cross-border merger or mandate the geographic priorities of a multinational miner.
The gap between ambition and authority is becoming harder to ignore. When Anglo American moved to acquire Teck, the proposed transaction revealed how complex sovereignty has become. The deal is subject to review under the Investment Canada Act. But even if Ottawa wanted to assert full control, the fate of its most iconic mining firm would also depend on regulators outside its borders.
This is not unique to Teck; it is the operating condition of the entire Canadian mining sector. Canadian firms extract resources in dozens of jurisdictions, depend on global capital markets and answer to shareholders from Toronto to Zurich to Tokyo. A domestically controlled mining champion carries soft-power value: it signals capability, stability and leadership in a sector where reputation increasingly shapes global investment and partnership opportunities.
Ottawa’s challenge is not preventing globalization; it is learning to guide it.
Part of the answer lies in understanding sovereignty as influence, not exclusivity. The Investment Canada Act remains one of Ottawa’s strongest tools, and the Carney government has signaled a readiness to deploy it more assertively when national security or strategic sector considerations are at stake.
Industry Minister Mélanie Joly has already signaled that she expects more from both firms before approving the deal – a reminder that Ottawa retains meaningful leverage within the process. But domestic review alone cannot ensure long-term Canadian advantage. What matters is how Canada uses its regulatory position to extract concessions that reinforce national priorities.
Canada also needs to widen its international lens. Other resource-rich middle powers are already adapting. Chile has created a hybrid model that preserves state influence while courting global capital and technology. Australia has redefined critical minerals as a sovereign industrial capability. In a world of cross-border supply chains, sovereignty is negotiated – continuously and deliberately. Canada could have the advantage of leveraging the whole of North America.
Aligning globalization with national priorities
This negotiation increasingly happens through the USMCA. The agreement gives Canada a platform to influence North American industrial strategy at a moment when the United States is aggressively rewiring supply chains. If Canada wants its minerals to strengthen Canadian industry – and not simply flow into U.S. supply chains – it must shape the regional system now.
Ottawa can make clear that cross-border investment must reinforce – not bypass – North American value-added production. It can also co-ordinate with Washington and Mexico City on shared assessment standards, permitting expectations, labour and environmental safeguards, and incentives for regional processing capacity.
For Canada to assert the most influence in USMCA negotiations, it must maximize its own leverage at this critical juncture and not open the door to pressure from foreign regulators. The question facing Ottawa is whether it continues to react or build a strategic framework that aligns corporate globalization with national priorities.
Canada has the right tools: a strong regulatory regime, a deep mining ecosystem, a continental trade agreement and a government that, so far, understands the stakes. What it needs now is clarity. Sovereignty in the 21st century is about ensuring that wherever Canadian companies operate – and wherever their minerals flow – the decisions that matter still advance Canada’s long-term interests.
If Canada can shift from assuming sovereignty to asserting it, it won’t just protect its resource future – it will define it.
