The government calls the $340 million project the “gold standard” while critics say it is a “toxic” foreign subsidy.
Canada's AI minister says Nokia's Ottawa expansion is “what sovereign AI looks like.” Industry critics, however, say the federal government's support for the Finnish multinational could actually harm the Canadian economy.
“This is what sovereign AI… looks like in practice. That means hiring Canadians, building technology right here, [and] implementation of technology around the world.”
Artificial Intelligence Minister Evan Solomon
Minister Evan Solomon spoke at the opening ceremony for Nokia's Ottawa campus expansion on Tuesday morning, where he twice used the catchphrase “sovereignty is not loneliness.” Extension supported by government funding of US$72 millionmore than half of which comes from the federal government, taken over under Prime Minister Justin Trudeau.
The $340 million project is renovating the Nokia branch at 600 March Rd. one day at home telecommunications company Newbridge Networks, founded in Ottawa, which after a series of acquisitions ended up in the hands of Nokia.
“This is what sovereign AI… looks like in practice,” Solomon said. “That means hiring Canadians, building technology right here, [and] implementation of technology around the world.”
Solomon's comments follow the Canadian government's commitment to buy canadian and support WithOsovereign innovationSolomon previously called digital sovereignty “the most pressing political and democratic issue of our time.”
Shopify CEO Tobi Lütke took it to X to express their dissatisfaction with the government's decision to support the Finnish firm. He called the government's involvement in the project “toxic” and said the subsidies make labor cheaper and bring wealth to the foreign company, not Canada.
“It is harmful to our economy that Americans and [overseas] Branches can hire Canadians at half the cost of everyone [C]around them because of these subsidies,” Lütke said.
Nokia's Ottawa campus in Canada is developing fiber optic technologies, artificial intelligence (AI) technologies and quantum-safe networking technologies that will be deployed around the world, all of which are “absolutely important,” Solomon said.
“Sovereign AI means supporting Canadian innovation, working with allies, ensuring resilience, security and building our digital infrastructure,” Solomon added, expanding the definition even further. “Nokia ticks all the boxes.”
Nokia's consolidation as a Canadian innovation despite its headquarters being on the other side of the planet has been an ongoing challenge for the Council of Canadian Innovators (CCI), a technology sector lobbying group.
On BetaKit PodcastFollowing the 2025 budget, CCI President Ben Bergen clarified that any company registered in Canada is considered Canadian, even subsidiaries of multinational companies. Like Lutke, Bergen warned that spending money on this would not really benefit domestic firms.
Following Solomon's speech at Nokia, Bergen told BetaKit in a text message that “The Council of Canadian Innovators will continue to work with Minister Solomon and the federal government to make clear that issuing checks to foreign multinationals is not an innovation strategy and does not advance Canadian sovereignty.”
Solomon has repeatedly recognized the importance of ensuring that Canada has its own strong domestic innovation and is not made up of foreign subsidiaries.
“We can't be a nation with branches, we have to be a nation with AI headquarters, so we keep the people, our intellectual property and our ideas here,” Solomon said at the ALL IN conference in Montreal in September.
But although the Canadian government has committed to supporting sovereign cloudwhich Solomon says means Canadian data control is “free from coercion,” he also did not rule out American partners within the framework of the project.
CONNECTED: Nokia opens new office in Toronto as part of wider expansion in Ontario
When asked at the groundbreaking event how Nokia's expansion fits into Canada's digital sovereignty, Solomon pointed to the creation of 340 jobs and called it “an investment in one of the country's largest technology hubs.”
“This is literally the very definition of what it means to be a strong, sovereign nation,” Solomon said. “You need partners who have been here a long time, who are growing here, who will be here, and that’s not all.”
“This is literally the gold standard of what we want to see,” he added.
In another X postLütke said partnering with foreign multinationals is a viable strategy for factory and manufacturing jobs or even to launch industrial strategies in energy and data centers, but “it's just a crazy idea to do the same with knowledge jobs.”
However, Nokia's expansion was seen by politicians as a boon for Ottawa. Kanata North MP Jenna Sudds called the new center a “vote of confidence” in Canada's innovation economy, and Mayor Mark Sutcliffe said “we think of Nokia as a local company” because of its strong presence. International Trade Minister Maninder Sidhu said “this is what trade diversification looks like.”
Nokia Canada President Geoffrey Maddox told reporters after the event that the government had been a “fantastic partner.”
“I will tell you that, as the head of a multinational corporation in Canada, Canada is moving faster than we've ever seen government action on many of these issues. [technology] themes,” Maddox said.
The new research and development center is scheduled to open in late 2028 or early 2029, Maddox said. It will occupy approximately 750,000 square feet in the heart of the Kanata North Tech Park and will be home to more than 1,900 Nokia employees in Ottawa.
Disclosure: Good Future, the majority owner of BetaKit, is the family office of two former Shopify leaders, Arati Sharma and Satish Kanwar.
All images courtesy of Alex Riehl for BetaKit.
