Canada will be the host of the new global defence bank, according to a source familiar with negotiations.
The source said Canada was the unanimous choice among 19 member countries to headquarter the proposed Defence, Security and Resilience Bank (DSRB).
But the source cautioned there’s a chance the bank won’t end up happening.
“There’s still a lot of work to do, but Canada will definitely be the host if the bank goes ahead,” they said.
The Star granted the source anonymity because they were not authorized to speak publicly about the matter.
The decision, which was first reported by the Globe and Mail, was made after the third round of negotiations to discuss the bank’s structure wrapped up in Montreal on Wednesday.
The first round of in-person discussions kicked off March 23, also in Montreal.
“In this context, Canada is playing a leading role, building on its broader efforts to strengthen national defence and support its defence industrial base,” the federal Finance Department wrote in a March news release.
The DSRB’s goal is to address financing challenges facing democratic countries as they aim to secure borders and boost military spending amid a new era of geopolitical uncertainty.
The bank will be owned exclusively by up to 40 nation-states, according to the DSRB Development Group’s website, and will be designed to mobilize low-cost capital needed for defence, security and resilience investments for NATO members and allied nations.
Supporting the creation of the bank are several private sector partners, including all of Canada’s Big Six banks — BMO, CIBC, National Bank, RBC, Scotiabank and TD. Deutsche Bank and J.P. Morgan are also backers.
The DSRB Development Group did not immediately respond to the Star’s request for comment.
David Perry, head of research institute Canadian Global Affairs Institute, welcomed the news.
“I think it shows that Mr. Carney’s gone a long way to restore Canadian standing and confidence amongst other partners and allies on defence issues,” Perry said. “I think it would have been extremely unlikely for this initiative to land with Canadian leadership two years ago.”
In February, Prime Minister Mark Carney launched Canada’s first-ever Defence Industrial Strategy, seeking to boost defence exports by 50 per cent within a decade. A month later, the federal government announced it hit NATO’s two per cent of GDP defence spending target.
But several organizations, including the Canadian Centre for Policy Alternatives and the Canadian Association of Professional Employees, have recently denounced Canada’s participation in the defence bank.
In an open letter published April 14, the groups argued that the initiative would “take money away from social and environmental needs” and direct it towards arms manufacturers.
“Financing war won’t bring us peace,” they wrote.
The host city for the DSRB has yet to be announced.
In December, Premier Doug Ford and Mayor Olivia Chow made a joint bid for the bank to be located in Toronto. Ottawa, Montreal and Vancouver have also expressed interest.
The Star reached out to Chow’s office but did not receive a response in time for publication.
A senior provincial official, speaking on background, told the Star the government had not yet heard any confirmation that the bank, which could create 3,500 high-paying jobs, would be located in Canada.
But the official reiterated Ford’s argument that Toronto should be the host city.
“Toronto is the only logical place for it to be as the financial capital of the country.”
With files from Tonda MacCharles and Alex Ballingall
