Global security environment prompts important questions for defence industry

CANSEC defence and security

CANSEC, one of the city’s largest trade shows, starts tomorrow through June 1 at the EY Centre. To highlight some of the issues facing the industry, both nationally and locally, we spoke with Canadian Association of Defence and Security Industries (CADSI) vice-president of business development Steven Hillier.

Q: Defence and national security seem to be hot political topics right now. There’s much discussion around new investments, military capabilities and how Canada engages in international alliances. What does that translate into, on the ground, from a business perspective? 

The global security environment has deteriorated in the past 18 months and a big reason for that has been Russia’s illegal and unprovoked invasion of Ukraine. The discussions that’s prompted are important ones. Are we ready to defend Canada in the modern era? What do we need to do that effectively? There’s a defence policy update happening right now that, in theory, could start providing a view into the government’s thinking on these questions.

But, on the ground, business cycles in defence are often measured in years — even decades. Companies will position themselves well in advance so they’re ready to jump when an RFP finally hits the street on a large project like the Future Fighter or the National Shipbuilding Strategy. Long-term planning and visibility are important. In 2017, the government unveiled its overarching defence plan – Strong, Secure, Engaged, or “SSE” for short – and since then it’s been steadily implementing that roadmap, along with advancing its defence investment plan. Last summer, some new NORAD modernization and continental defence projects were added to the list and there have been some recent, one-off acquisitions linked to the war in Ukraine. But, as always, companies will position themselves in response to the customer’s stated needs and those needs must be clearly articulated before we begin making changes to lines of business or ramping up production.

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Q: Defence companies in the National Capital Region are quite bullish. But they often cite government red tape and regulations, talent shortages and challenges with accessing global markets as obstacles. Is there anything more the government can do to support local industry players? 

Defence is not like other markets. It’s tightly regulated and governments worldwide often favour their defence industrial bases, so the market can be quite protectionist. Canada’s government could do more to smooth the path for homegrown companies and champion them abroad. Likewise, we could look at more partnerships between government and industry — like talent exchanges — to help address talent shortages. This need is particularly true in the cyber domain. And finally, the industry understands that export regulations exist for a reason. But the government must ensure that it meets its service standards when issuing export permits and security clearances. These are tough challenges, but the solutions are there. And CADSI, as the voice of the Canadian defence industry, has been pushing hard for them in recent years. 

Q: How would you describe CANSEC to someone who has never heard of it? 

Officially, we describe CANSEC as North America’s premier defence, security and emerging technologies trade show. But I think, at its core, it’s a connection point; for industry, for government and for the military. It’s an opportunity for 300-plus companies to show off their latest and greatest capabilities directly to the customer. There are massive defence trade shows in Europe and the Middle East and we consider CANSEC to be a boutique version of that — distilling the best parts of those events and condensing them into two high-value, networking-packed days. 

Q: What are some of the benefits of the show for the local economy? 

CANSEC is actually Ottawa’s biggest annual business event. Although not open to the public, its global reach makes booking a hotel in the city for the last week of May impossible. Once they’re here, those delegates are spending corporate dollars, hosting networking events all over the city, taking clients out for dinner, shopping, and more. We estimate the economic impact to be around $15 million. But many of our members bring local economic benefits to Ottawa year-round.

Q: That’s interesting. In what ways? 

Well, many defence and cybersecurity-focused companies have their Canadian headquarters in Ottawa or work closely with Invest Ottawa and Bayview Yards. The industry has always been a big driver of innovation and growth and we have government statistics to back that up. Ottawa, of course, is Canada’s government and military hub and that attracts world-class companies like Calian, Lockheed Martin and many other advanced technology firms that call Kanata home. That type of tech cluster becomes a business ecosystem of its own, where like-minded companies will set up shop and grow their networks. Bayview Yards is another perfect example of how defence and security companies can come together and act as economic drivers. 

Q: You’ve been personally involved with the show for 15 years. How has it changed? 

It’s been a privilege watching CANSEC grow into the event it is today. It used to be a small, annual Ottawa trade show where you would know everyone on the floor. Today, it’s tripled in size, attracts over 50 international delegations and top executives, and features ministers making strategic announcements on stage. As it’s grown, it’s also moved — from the Ottawa Congress Centre, to Lansdowne, to its home today at the EY Centre. And we’re bursting at the seams even now due to demand, which has become one of our selling features. 

Q: So how do you think CANSEC will evolve moving forward? Could it ever outgrow Ottawa? 

As we all know, the technological revolution is here and it’s happening fast. The defence industry is not immune, especially when it comes to advancements in AI, communication systems, autonomous systems, cyber systems, and blockchains. As the demands of a modern military evolve, the industry is evolving, too. As the association representing that marketplace, we recently established the CANSEC Labs to showcase emerging technology companies not traditionally involved in the defence sector and that will keep growing.

We know how lucky we are to be in a strategic city like Ottawa and have exceptional partners in Invest Ottawa, Tourism Ottawa and multiple government entities. So for the foreseeable future we’re proud to call Ottawa CANSEC’s home. 

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