00:00If we could just continue the conversation on the energy shock emanating from the Middle East due to
00:04the war between the U.S., Israel, and Iran. How is Ontario, Canada feeling the ripple effects of
00:10that shock already? And how is it affecting your outlook as finance minister? Well, great to be
00:16with you again. Great to be here in New York. You're in Washington. Great to see you. It has
00:21a double-edged effect. Clearly, you just heard that for Canada, we were a big oil producing
00:27nation, big agriculture, fertilizer, potash, all those things. Great. But we're feeling
00:32it in Ontario at the pumps. That's where we feel it. And it'll flow through to the supply
00:38chain if this persists. I think that's an impact. So mixed emotions about the price of oil right
00:43now. Interesting. What is an average gallon of gas for you? Minister, we're at $4.17 today.
00:51Does that sound familiar? Yeah, it is. I spent two decades of my life here in New York, so
00:56very familiar. Not that high. It's $1.70 a liter. I haven't quite figured out the conversion
01:02between liters and gallons, but we're roughly the same. Let me work on that here. We're roughly
01:05the same. And we feel the pinch at the pumps. We cut the gas tax in Ontario. We're a government
01:10that cuts taxes. So four years ago, we cut the gas tax. So it's diminishing the impact
01:15somewhat over $0.10 a liter, but still, or the equivalent at the pumps in the U.S. in terms
01:23of gallons. But it affects the price of everything, and affordability is an issue.
01:29Well, just like it is here in the United States, and an issue that, of course, has only sharpened
01:34due to the war with Iran, which, as we were just discussing with Mike, has seemingly reordered
01:39and perhaps structurally show so global energy markets and energy producers like those in
01:44the Gulf states. And of course, the energy production we have seen in the Middle East has empowered
01:48many of those GCC countries to have massive sovereign wealth funds that they can use to
01:53invest in other areas, be it technology or here in the United States or what have you.
01:57We learned yesterday, Minister, and you all know this, that Canada is now getting into the
02:02sovereign wealth fund game. This was announced by Prime Minister Mark Carney yesterday, giving
02:08essentially the Canada Strong Fund, seeded with $18.4 billion from the federal government.
02:14What's your reaction? What's your role in this, if any? Well, we have our own that we launched
02:19about four months ago or a couple of months ago. So we're going in the same direction. If you think
02:25about what we're doing in Canada right now is major projects, big infrastructure. So that doesn't just
02:32mean a pipeline to the West to build more supply to markets in Asia, Southeast Asia, but also pipelines
02:39up through the north through the Arctic and east through Ontario. We import a lot of our oil from
02:45the Middle East and eastern Canada and it gets refined in eastern Canada. We'd like to ship American
02:52and Canadian oil into those refineries. And of course, we were shipping a lot into the U.S. We're a
02:57big
02:57exporter of oil into the U.S. So we're your largest import market for energy. So this will help fund
03:04those
03:05major, major projects, tens of billions of capital required to do that.
03:10Interesting. Looking at the size and scale, for instance, looking at Norway's fund, which is in
03:17the area of $2 trillion, you mentioned $18 billion. How much could this grow?
03:23I think it could grow exponentially. And if you think about Canada, I mean, what we have up in Canada,
03:29your previous guest talked about oil and gas. We got an abundance of that. We also have an
03:34abundance of agricultural products. He mentioned that as well. But I would add critical minerals,
03:40rare earths. We have all the minerals that the world needs for technology. And that's from a safety
03:45of supply, security of supply. And we have an abundance of those minerals. So all these things,
03:50I think, are going to really add to not only the safety and security of the North American continent,
03:55I would add, but also from an economic prosperity point of view.
04:01Well, and Minister, you mentioned Ontario's own version of this, the Protect Ontario Account
04:06Investment Fund. Have you found a private sector asset manager for that yet?
04:10No, we're in the process of doing that. They're a couple months into the process.
04:13So hopefully conclude that shortly. But what that really is, is to, we have a lot of, I mean,
04:19an incredible amount of entrepreneurs in Canada. We have tremendous support from U.S. investors
04:24and investors around the globe. We just want to make sure that Canada, that Canadian investors,
04:29we have some of the largest pension funds in the world, are based in Toronto and in Canada,
04:33to put more of that capital to work in the growth areas. We mentioned energy. We're talking oil and
04:40gas, but Ontario has a massive footprint of nuclear energy. Over 50% of our province generates the
04:47electricity in Ontario. And by the way, I was in Midtown yesterday, and one company said,
04:51you're powering our building here from Ontario. So we ship electricity out of Ontario. We're also
04:58going to be big in defence industry. We're going from 2% of GDP to 5%. And on a Canadian
05:043 trillion
05:05economy, that's another 90 billion Canadian or about 65, 70 billion U.S. per annum. So a lot of growth
05:13opportunities. And that's part of our strategy with the, with our version of the wealth fund.
05:19Can I ask you, Minister Beth and Falvey, and I don't mean to interrupt. When you start increasing
05:23defence spending at a time like this in Canada, are you intentionally looking around the world
05:28for defence contractors to meet those needs? And by that, I mean, looking away from U.S. contractors?
05:33No, it's not either or. It's all of the above. I mean, the U.S. is our closest friend and
05:38ally and
05:39economic partner. Yeah, we're going to go through a negotiation on the U.S. MCA deal,
05:44deal with the Section 232s. But we're always going to have a very firm, longstanding economic
05:50relationship with the U.S. And that includes defence. I'm very confident of that. But, you know,
05:57the President and others have said, you've got to do more. And Canada's answering that challenge. So
06:01we're going to 5%. There'll be a lot of domestic, not just manufacturing, but drones and cyber
06:06technology. We've got to protect the North as well, the Arctic. So we're doing our share. And that's
06:12going to be a big growth industry for us in Canada. Well, you mentioned the economic relationship
06:17between the U.S. and Canada, Minister, which, of course, has been rocked by President Trump's
06:21tariff policies ahead of what could be a renegotiation of the USMCA trade agreement. What
06:27what is your understanding of the status of that right now? And what position Canada is bringing
06:32in terms of relative strength to those potential renegotiations, given everything that has gone
06:36on since President Trump came back into office? Well, you know, we're not only friends and allies
06:40and a long shared history together, but there's economic interests on both sides of the border.
06:45We're stronger. We're stronger together. I think we do some three, I'll do in Canadian dollars,
06:50360 billion of trade a year, so a billion dollars a day, 1.8 million Americans wake up every day
06:57to
06:57work on something that gets shipped to Ontario. And I think we're the number one or two, I think 26
07:04states are where they're number one or two trading partner. And if we were a country, we'd be the,
07:09in Ontario, the 20th largest. So there's economic interests on both sides of the border.
07:13You know, we have a lot of natural resources up in Canada that the US we trade with. And obviously,
07:20the the US has as a lot of attributes to for us to be able to sell into. So there's
07:25a lot of mutual
07:26commercial interest to, I think, get a deal done. And we'll we'll work it work it out with our with
07:32our
07:32neighbors. Mark Carney has said that Canada will not rush a tariff deal with the US and our remaining
07:39moment minister. Do you approve of that approach? Yeah, I think we want to get a deal that's a good
07:45for both sides. And I think that there is a deal. But through any negotiations, there's pre positioning
07:51and what have you, I'll be in Washington tomorrow meeting a number of people from Congress. The
07:55dialogue, the two way flow of information is essential. So I look, I'm an optimist. And I think
08:01just by force of geography and nature, culture, language, all those things, we're gonna we're
08:06gonna get through this together.
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