Canada will turn to the Norwegian company Kongsberg to acquire joint strike missiles to be used by future Royal Canadian Air Force fighter jets, such as the F-35s.
Prime Minister Mark Carney announced the contract, worth some $800 million, at the NATO summit in Ankara, Turkey, where allies are unveiling tens of billions in military-related spending.
It comes days after Canada advanced a major submarine procurement project, and as other NATO allies showcased billions in planned defence purchases, including for planes and drones.
The alliance's grand show of defence spending follows sustained pressure from the United States for NATO members to shell out more on collective defence so the Americans can pivot their focus away from Europe.
U.S. President Donald Trump "won the argument" on defence spending, Carney told reporters on Wednesday.
Trump has long said allies don't spend enough on defence and that the U.S. has carried more than its fair share of NATO's defence spending burden.
Carney told reporters at a short news conference in Ankara on the last day of the summit that Trump is looking to shift that burden — something former U.S. president Barack Obama had sought as well.
That's starting to happen, he said.
"That's gaining momentum," Carney said. "That's part of the point I made to President Trump when we spoke a few days ago … It's not just he's winning the argument, he's won the argument.
"Countries recognize that they need to take more responsibility, see the direct threats."
Mark Rutte, NATO secretary-general, said Trump is "transforming the alliance and making it stronger" during his closing news conference Wednesday.
Trump once again talked about a desire to take control of Greenland and threatened to cut off all trade with Spain during the summit.
When a reporter asked Rutte if staying silent when Trump makes these statements affects his self respect, Rutte doubled down on his praise for the president.
"I think we should praise Donald Trump for the fact that NATO is so much stronger. Of course it has to do with the Russian threat, it has do with war in Ukraine, but it very much also has to with President Trump," Rutte said, adding Trump is continuing former president Dwight Eisenhower's work in trying to equalize NATO contributions between the U.S. and Europe.
"That makes Europe stronger, it makes Europe more relevant for the United States as a partner. So that is the transformative character of this summit."
On Greenland's territorial integrity, Rutte said that was discussed in Davos, Switzerland, earlier this year and the alliance members need to work together to deter Russia and China in the Far North.
As for Greenland's future, Rutte said that is up to the U.S., Greenland and Denmark, which are in ongoing talks.
The prime minister said global security threats are "changing rapidly" along with advances in military technology such as hypersonic missiles and autonomous warfare.
Carney spoke with Trump on Sunday and told reporters the president was in a good mood at the time, as he was when he attended a dinner for NATO leaders on Tuesday night.
But based on what Trump said at the summit in public, you wouldn't know it.
When Trump appeared at the conference and spoke with Secretary-General Mark Rutte Wednesday, the president emphasized he is still upset with alliance members and threatened to end trade with Spain.
"I'm not happy with NATO because of what they did with Greenland, and I'm not happy with NATO because of the fact that they didn't want to help us with the number one state sponsor of terror, that's Iran," Trump said.
Trump's war with Iran and past threats to annex Greenland have heaped strain on the alliance. Trump added that he would raise Greenland as an issue during the North Atlantic Council meeting.
Rutte sought to assuage Trump ahead of that meeting, telling him he was responsible for a massive surge in military budgets across the alliance.
Ahead of arriving in Turkey this week, Carney announced German manufacturer TKMS will be the preferred bidder for Canada's next navy fleet of submarines.
Kongsberg is also involved in the supply chain for TKMS' 212CD submarines.
The massive contract will rocket up Canada's military spending, helping it make the case to NATO allies that it's stepping up on defence.
The German-Norwegian bid narrowly beat South Korea's Hanwha to become the preferred contractor, although Hanwha could still win the contract if negotiations with TKMS fall through.
Asked if there would be a consolation prize to smooth over relations, Carney said Canada is already hammering out other plans with Seoul.
He said he had a productive meeting with President Lee Jae Myung on Tuesday on the margins of the summit.
"Obviously, he was disappointed, but the conversation immediately pivoted — at his initiative — to a series of issues around AI and technology risks and how we can continue to deepen our co-operation there," Carney said.
"That's not a consolation prize. That is allies working together strategically on important issues."
Meantime, Carney said Operation Reassurance — the decade-old, Canadian-led multinational brigade in Latvia — is being extended until 2031.
Canada will also up its boots on the ground by bringing the total troop count up to about 2,600 from 2,200.
Picture Courtesy: THE CANADIAN PRESS/Adrian Wyld
