Under the current supercycle, Tim Hodgson said critical minerals have moved from the margins to the centre of many countries' industrial strategy and economic policies. Photo by Brent Calver/Postmedia

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“Critical minerals are no longer simply industrial commodities,” he said at an event hosted by Canada House in London on Monday. “They are the inputs that will decide which economies can grow, which can compete and which countries will secure their economic futures.”

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Hodgson said that’s why the government made the Building Canada Act, which streamlined the regulatory process for large projects such as mines, its first “signature” piece of legislation.

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It’s also why it is hoping to pass the Building Canada Strong Act, a 240-page bill tabled in September that he said would create a process for major project approvals to be reviewed by one federal agency within one year.

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All this is necessary because the mining sector is unprepared to meet the growing demand for critical minerals and large supply gaps will soon emerge, he said.

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“Canada has extraordinary resources, but, historically, we may not always have been sufficiently competitive on the execution front,” he said, referring to the time it has taken for some projects to receive regulatory approval.

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An investment supercycle refers to a prolonged period of capital spending on new mines driven by a major shift in the global economy, with the last and best-known example being the industrialization of China that began around 2001 and lasted roughly a decade.

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Global commodity prices shot up and there were persistent deficits in materials as China built skyscrapers, rail lines and electrical grids.

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Under the current supercycle, Hodgson said critical minerals have moved from the margins to the centre of many countries’ industrial strategy and economic policies.

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Historically, he said companies sourced minerals and metals based on “cost and efficiencies,” but now they’re increasingly governed by concerns about export controls and geographical trade exposures, citing the conflicts in the Middle East and Africa rather than China, which has placed export restrictions on its rare earths at multiple times in recent years.

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Hodgson’s speech echoed themes similar to what Prime Minister Mark Carney declared in Davos, Switzerland, earlier this year, including that free trade and multilateralism are “being called into question.”

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Hodgson said the world is not short on demand for metals and minerals, but it is short on dependable supply, something Canada hopes to fill.

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In addition to streamlining the regulatory process, he said Canada has improved its relationship with Indigenous communities, which are now often partners in major natural resources projects.

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“We’ve crossed the rubicon to where we’re now working constructively,” he said.

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