About our research

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The global food system refers to the interconnected network of production, 

distribution, and consumption of food on a worldwide scale. Its objective is 

to ensure food security. Over the last 50 years, continuous improvements 

in farming methods, new technologies, and infrastructure capacity in 

international supply chains have allowed for a more affordable and safer 

food supply for an increasing global population. This has fostered domestic 

and foreign political stability. Fueled by the liberalization of exchanges and 

the rise of agri-food giants, and under the influence of cheap fossil fuels 

and mineral fertilizers, agricultural systems worldwide have converged 

towards industrial agriculture to feed a growing population that is also 

adopting similar food habits. Globalization and large-scale public policies 

have enabled billions of people to escape food insecurity, mostly in low- and 

middle-income countries. However, food security has come at a large 

environmental cost and has not always been successful in terms of equity. 

Particularly in Western countries, unhealthy and unsustainable diets are 

becoming the norm, while producers are caught in the crossfire between 

more stringent environmental policies and the economic push for 

competitiveness in international markets.

Furthermore, the fragility of food supply and the inelasticity of demand 

provide a perfect opportunity for foreign powers to exert pressure on food￾insecure countries, using it as another tool of unconventional warfare. In 

their current state, it seems impossible within food systems to balance 

economy, environmental justice, and social justice. This calls for large-scale 

agri-food policies. There is a need to derisk investments in agriculture to 

promote the so-called agro-ecological transition, by incentivizing innovation 

and rewarding environmentally friendly practices. A shared governance of 

more territorial agri-food systems should be designed to ensure a fair 

distribution of monetary and non-monetary benefits across stakeholders. 

Mobilizing a “One Health” approach, policy programs should address the 

existing contradictions in the food systems, from a producer's perspective 

but also to better educate consumers. In particular, international trade 

agreements and standards for financial and extra-financial disclosure 

should be used as tools to correct market failures and inequities in the 

current food system

The 2022 passage of the Inflation Reduction Act in the United States has kickstarted 

investment in green technology and transportation through eye-watering corporate tax 

incentives. The estimated subsidies are so large that they create disincentives for global 

firms to invest anywhere but the United States, raising concerns about the capacity of 

other countries to compete. In response, Canada has matched US incentives for a 

handful of greenfield investments in the electric vehicle (EV) sector. 

This paper analyzes the largest of those projects in the Canadian province of Ontario, a 

new Volkswagen EV battery plant announced in 2023 for the small community of St. 

Thomas. Details surrounding the investment are presented and situated within the 

broader challenges of accelerating Canada’s critical mineral supply chain capacity. 

The Volkswagen investment reflects a policy reversal by the Trudeau government 

regarding industrial subsidies, from refusing to engage in subsidy races to attract 

Amazon’s new headquarters in 2017, to dollar-for-dollar matching of US incentives to 

lure EV plants in 2023. It is argued that the unique design and sectoral focus of the 

Inflation Reduction Act, combined with dramatic changes to the global geoeconomic 

context over the intervening period, have driven Canada’s shift to embrace of US-led 

industrial policy. 

The broader implications for supply chain de-risking and friend-shoring among middle 

power countries are then considered. As the Washington Consensus that embraced 

globalization, free markets, and liberalized trade comes to an end, we are living 

through a transition period in which alternate models are being tested. While they must 

respond and adapt to the new context, countries such as Canada and Germany should 

avoid becoming inextricably committed to the big industrial policy experiments 

underway. Middle powers can also work to de-risk their own exposure to disruptive and 

unilateral global players by increasing their trade with, and mutual reliance on, one 

another. In addition, they can advocate for the interests of poor countries that may be 

vulnerable to exclusion from ‘friend-shored’ supply chains, to avoid further fracturing 

global trade.

Germany is the 5th largest economy in the world and Canada the 5th largest energy

producer. Their strong relationship and common values can help them build on their complementarities to work on the energy transition they both want to realize. With 80 million, Germany has twice the population of Canada, and an even larger gross domestic product (GDP). Despite these two important energy demand drivers, the German energy consumption is only just slightly greater than the Canadian one. It is also on a decreasing trajectory, in absolute terms, while the Canadian energy consumption continues to grow. Greenhouse gas (GHG) emissions follow a similar path. These two differences, in energy intensity and trend, should not eclipse the fact that the final energy consumption in Germany and Canada relies on a similar mix of energy types (about 45% of oil products, 25% of natural gas, 20% of electricity, with biofuels, waste and coal making up the remaining shares). In addition, energy consumption in the two countries is distributed very similarly across sectors: about 25% in industry, 30% in transport, around 20% in the residential sector, 12% in the commercial sector, 3% in agriculture and 10% in non-energy uses.