The federal government and Ontario have signed a new cooperation agreement aimed at accelerating major infrastructure projects by streamlining environmental and impact assessments, as Canada moves to diversify its economy amid growing global trade uncertainty.
Prime Minister Mark Carney and Ontario Premier Doug Ford announced the agreement on December 16, establishing a “one project, one review” approach for major infrastructure initiatives in the province. The deal is designed to reduce regulatory duplication between federal and provincial governments while maintaining environmental protections and Indigenous rights.
Under the agreement, Canada and Ontario will adopt a more flexible assessment process that allows projects to proceed using either Ontario’s environmental review system or a coordinated federal-provincial process, depending on the circumstances. The goal, officials said, is to deliver major projects faster while ensuring strong oversight.
“Canada’s new government is focused on what we can control — building a stronger, more sustainable, more independent Canadian economy,” Carney said in a statement. “Our agreement with Ontario will build major projects faster, helping to diversify our trade partners, strengthen our industries, and empower more Canadians with high-paying careers.”
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The Ontario agreement is the third of its kind for the federal government. Similar deals have already been signed with British Columbia in 2019 and New Brunswick earlier in December. Consultations with Manitoba and Prince Edward Island have concluded, with agreements expected to be finalized, while negotiations with Alberta are ongoing and targeted for completion by April 1, 2026.
According to Statistics Canada, regulatory requirements increased by 37% between 2006 and 2021, a trend the federal government says has reduced business investment growth by 9% — a key driver behind the push for regulatory reform.
The Ontario agreement also aligns with the federal government’s broader Major Projects Office (MPO) initiative, created under the Building Canada Act, which came into force in June 2025. In November, Carney announced a second tranche of projects referred to the MPO, representing tens of billions of dollars in potential investment.
Together, the first two tranches of MPO projects could total more than $116 billion in investment and support thousands of jobs across the country. The federal government has committed $40 million over two years to boost Indigenous participation in major projects and has expanded the Indigenous Loan Guarantee Program from $5 billion to $10 billion.
The Impact Assessment Agency of Canada will continue to provide Ontario with federal expertise, including support on environmental protection, Indigenous engagement, and sustainable project development. Both governments say the agreement preserves their respective responsibilities to protect the environment and uphold the rights of Indigenous Peoples.
The announcement comes as Canada faces significant economic disruption driven by shifting global trade relationships, particularly with the U.S. The federal government says it is prioritizing domestic infrastructure development and trade diversification to build a more resilient and independent economy.
Ford said the agreement would remove regulatory barriers that have slowed large-scale development in Ontario, including projects in the mineral-rich Ring of Fire region.
“With this historic agreement, our two governments are working together to remove unnecessary red tape and regulatory duplication that has stood in the way of nation-building projects for too long,” Ford said.
Federal Intergovernmental Affairs Minister Dominic LeBlanc said the streamlined approach would help attract investment and provide greater certainty for major project proponents.
“By adopting a ‘one project, one review’ approach in Ontario, we are simplifying major project assessments, catalyzing new investment, development, and good-paying careers,” LeBlanc said.
Environment and Climate Change Minister Julie Dabrusin emphasized that environmental protection and Indigenous rights would not be compromised under the new framework.
