Prime Minister Mark Carney

created a new Defence Investment Agency to build domestic manufacturing and accelerate the rearming of the Canadian military, aiming to boost sectors such as steel that have been damaged by U.S. tariffs.

Carney announced the new agency on Thursday, fulfilling an election campaign promise to shake up Canada’s military procurement process. Doug Guzman, a longtime executive at

Royal Bank of Canada

, will be its chief executive.

“This is a tremendous opportunity for partnership between government and businesses. All at once, we can drive investment, strengthen our national security, and meet our international commitments,” Guzman said in a

news release from the prime minister’s office.

“We will bring speed and simplicity to the process of arming our military, while building Canada’s industrial capacity.”

The agency will try to accelerate defence acquisitions by creating a centralized process of review and approval. It will also tie procurement to domestic industrial benefits, boosting innovation in aerospace, shipbuilding and advanced manufacturing, Carney’s office said.

It will align Canada more closely with allies including the U.K., Australia and France, which already have dedicated procurement bodies, the prime minister’s office said. It positions the country to participate in the

European Union

’s major rearmament program, it said.

Carney has made reviving Canada’s military a central part of his economic strategy, as the White House takes a more skeptical approach to traditional security alliances and batters Canadian manufacturing with sectoral tariffs.

Canada has pledged to meet the

North Atlantic Treaty Organization

’s target of spending two per cent of

gross domestic product

on defence this fiscal year and reach five per cent of GDP by 2035.

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Guzman has three decades of experience in investment and finance, including in leadership roles at RBC and Goldman Sachs. He was RBC’s group head of wealth management before shifting into a deputy chair role in a move announced last year.

Bloomberg.com