Ottawa’s Plan to Invest Billions in AI: Will It Be Worth It?
Commentary
The federal government is aiming to join the Artificial Intelligence (AI) wave and become a significant player and contributor in the field. While investing in Canada’s long-term growth is crucial, there are reasons to question the value of these specific expenses.
As part of the numerous announcements Prime Minister Justin Trudeau is making leading up to Budget Day on April 16, the government has unveiled a funding package for AI.
A total of $2.4 billion is allocated for various AI initiatives, with some going to grants for start-ups and the majority—$2 billion—earmarked for developing AI infrastructure.
The press release states, “Ensuring access to cutting-edge computing infrastructure will attract more global AI investment to Canada, develop and recruit the best talent, and help Canadian businesses compete and succeed on the world stage.”
Both Canadian taxpayers and innovation advocates should carefully examine the details. The current buzz in venture capital and private equity circles revolves around AI, with substantial investments flowing into the sector. It seems like merely mentioning “AI” while strolling down Wall Street or Bay Street will attract funding.
It’s challenging to believe that the Canadian government has much to offer at this point, particularly in funding start-ups. It feels like we are latecomers trying to catch up after everyone else has already made their move.
Distributing grants and project loans ultimately boils down to selecting winners and losers, and it’s doubtful that the government can allocate capital more effectively than those deeply involved in the AI landscape.
Perhaps deserving companies needing a boost alongside private capital or those overlooked could benefit from the funds. Or will taxpayer money end up supporting companies already deemed to fail by the private sector?
Justifying this expenditure by claiming “Canada has a world-leading AI ecosystem” also warrants scrutiny. While Canada has exciting developments in the tech field and aspires to be a global leader, we should not overestimate our significance or importance in the sector.
