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Shipbuilding and naval-tech firms say they are optimistic about the future as the federal government significantly increases defence spending to satisfy NATO allies who have long said Canada is falling behind on military funding.

Earlier this year, NATO leaders — including Canada — endorsed a plan to increase defence spending across the alliance to five per cent of GDP over the next decade.

According to a NATO report from last year, Canada was estimated to spend roughly 1.37 per cent of its GDP on defence in 2024.

Ottawa’s recent federal budget announced $6.6 billion over five years on spending for its forthcoming defence industrial strategy.

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