Amount: up to $30 million

The Canada Strong Diversification Fund (CSDF), delivered through the Strategic Response Fund (SRF), supports Canadian businesses significantly affected by U.S. tariffs. The fund helps businesses maintain operations and supply chains, protect jobs, and strengthen their resilience in response to ongoing trade disruptions.

The program’s tariff response support has been expanded to include industries newly affected by tariffs, with funding available for ongoing capital maintenance projects. This additional support helps eligible businesses maintain existing capital investments, sustain operations, and preserve domestic capacity amid continued trade uncertainty and disruption.

The CSDF primarily supports projects with eligible costs exceeding $20 million and federal funding requests of $10 million or more.

Stream 1: Adapting, Pivoting and Diversifying the Canadian Economy

Funding is available for projects that help Canadian businesses, including small and medium-sized enterprises, adapt their operations, enter new markets, increase self-reliance, and attract strategic investment in Canada.

The funding supports businesses in sectors significantly affected by U.S. tariffs, with projects focused on:

  • Maintaining and expanding Canada’s existing industrial capabilities to support economic stability
  • Developing new products and technologies to take advantage of emerging market opportunities
  • Investing in productivity, materials, and products to strengthen Canada’s economic security and resilience

Eligible sectors

Eligible businesses may include companies in sectors significantly affected by U.S. tariffs, such as:

  • Aluminum
  • Automotive
  • Forest products
  • Steel
  • Other tariff-affected industries

Eligible projects

To qualify, businesses must operate in a sector highly exposed to tariff impacts and propose a project that supports domestic production, expands into new markets, protects jobs, or strengthens Canada’s long-term competitiveness.

Priority may be given to projects that:

  • Support highly trade-exposed sectors or businesses experiencing significant revenue declines, reduced profitability, or job losses
  • Include large-scale front-end development and capital investments to pivot toward alternative markets or products or improve competitiveness
  • Are critical to maintaining Canada’s industrial capacity, workforce skills, or capabilities needed for economic resilience and crisis management
  • Help businesses increase their capacity to meet Canadian market demand and accelerate export growth.

Stream 2: Capital Maintenance

Non-repayable funding is available to support ongoing capital maintenance projects and provide short-term liquidity to Canadian businesses affected by the new U.S. Section 338 tariffs. Support is available for a maximum period of two years.

Capital maintenance refers to costs required to repair, replace, or restore existing capital assets to maintain ongoing operations. Eligible expenses are limited to capitalized equipment and building costs directly related to the maintenance of existing capital assets.

Eligible sectors

The stream is intended for Canadian businesses operating in sectors significantly affected by U.S. tariffs, including:

  • Wood and paper manufacturing
  • Plastic products manufacturing
  • Information and communications technology (ICT) manufacturing
  • Machinery manufacturing
  • Electrical equipment manufacturing
  • Furniture manufacturing
  • Chemicals
  • Food and beverage
  • Textiles and apparel
  • Cement

Other sectors affected by U.S. tariffs may also be considered.

Eligibility requirements

The applying organization must:

  • Be incorporated or registered in Canada as a for-profit or not-for-profit organization and conduct business in Canada. Eligible organizations may include commercial enterprises, co-operatives, industry-led consortia, and collaborative partnerships involving industry, Indigenous organizations, and academia
  • Employ at least 10 full-time equivalent (FTE) employees
  • Generate at least $20 million in annual revenue
  • Have an average of at least $5 million in annual capital expenditures (CAPEX) over the most recent three fiscal years
  • Demonstrate a direct or indirect impact from U.S. Section 338 tariffs

Funding

Funding requests must:

  • Provide medium-term relief for up to two years
  • Be between $5 million and $30 million
  • Support ongoing capital maintenance activities

Eligible costs may include capitalized equipment costs, capitalized building costs, and direct labour specifically required to maintain existing capital assets. All eligible expenses must be necessary and reasonable for carrying out the activities outlined in the contribution agreement.