Canada is facing a significant technology adoption gap that threatens long-term productivity, prompting a major federal push to help small and medium-sized enterprises integrate artificial intelligence. The strategy aims to raise business AI adoption from 12 percent today to 60 percent by 2034 through targeted financing and infrastructure support.
A federal push to move small and medium-sized enterprises from 12% to 60% AI adoption by 2034 through coordinated financing, infrastructure, and business support.
Canada is facing a significant technology adoption gap that threatens its long-term economic productivity, prompting a massive federal funding push to help small and medium-sized enterprises integrate artificial intelligence. The Government of Canada’s new “AI for All” strategy aims to increase business adoption of AI from 12 percent today to 60 percent by 2034. To achieve this, Ottawa is deploying billions of dollars in targeted financing, regional support, and computing infrastructure.
A central piece of the plan is the new LIFT program, a $500-million initiative delivered by the Business Development Bank of Canada. This program will help smaller firms access the financing required to incorporate advanced software and hardware into their daily operations. Additionally, the government is investing $500 million to expand the Regional Artificial Intelligence Initiative through regional development agencies to speed up commercialization.
Currently, small businesses face severe barriers when trying to scale their innovations. Statistics Canada reports that only eight percent of Canadian small and medium-sized enterprises have adopted AI, placing the country far behind Nordic nations, Germany, and France. Furthermore, 78 percent of non-adopting firms state they do not see how the technology benefits their specific goods or services.
To address this translation problem, the government will introduce an AI Literacy and Adoption Assessment tool. This online resource will help entrepreneurs evaluate their readiness, identify practical use cases, and understand business impacts in a low-risk environment. Targeted support will also be delivered through the Small Business and Entrepreneurship Development Program.
SMEs will also receive a major boost in computing power through a $700-million expansion of the Compute Access Fund. This funding will provide affordable, domestic sovereign compute resources so Canadian startups do not have to rely on foreign cloud platforms. Currently, many firms send sensitive data and intellectual property offshore because they lack local options.
The government is also leveraging tax incentives to encourage private investment. This includes the Scientific Research and Experimental Development tax credit and a new Productivity Super-Deduction. These measures are designed to make innovation more affordable for businesses trying to stay competitive during global trade disruptions.
By combining direct financing with infrastructure support, the strategy seeks to unlock a three percent increase in gross domestic product. This represents nearly $200 billion in economic gains driven by labour productivity. Officials hope these resources will allow Canadian companies to scale up at home rather than relocating to foreign markets.
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