Foreign direct investment (FDI) into Canada reached its highest level since 2007, totaling $96.8 billion in 2025. This represents a roughly 12 percent increase from the previous year. Statistics Canada reported that mergers and acquisitions were a major factor, accounting for $43.6 billion of the total FDI. This surge signals strong interest in Canadian assets, but economists are offering varied perspectives on the long-term implications of this investment.
While the United States remains a primary source of FDI, investment from the United Kingdom also played a significant role, comprising approximately 12 percent of the total. TD Economics suggests that UK investors view Canadian tech companies as promising ventures with potential access to North American markets. Prime Minister Mark Carney has emphasized attracting foreign capital as part of a broader strategy to boost Canada's economic growth and reduce reliance on the U. S. market.
Economists like Maria Solovieva from TD Economics caution that the sheer volume of investment isn't the only factor to consider. The types of transactions and the specific sectors receiving investment are also crucial. While mergers and acquisitions contributed significantly to the FDI increase, these activities don't always guarantee long-term economic benefits for Canada. Solovieva noted that it is important to analyze FDI on a sectoral basis to fully understand its implications.
Net investment into Canada exceeded net outflows by $17.4 billion in 2025, a significant shift from 2022. The government is striving to attract $500 billion in private investment over five years, including foreign capital. The push for new export markets appears to be yielding positive results, as Canada aims to diversify its economy and strengthen its global position.
