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Thread: The nuclear option: why has Australia ditched the French submarine plan for the Aukus

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    Default The nuclear option: why has Australia ditched the French submarine plan for the Aukus

    In escalation over submarine deal, France recalls envoys from U.S. and Australia

    By John Irish and Colin Packham, David Brunnstrom, Humeyra Pamuk

    September 18, 2021

    PARIS/CANBERRA/WASHINGTON, Sept 17 (Reuters) - France plunged into an unprecedented diplomatic crisis with the United States and Australia on Friday after it recalled its ambassadors from both countries over a trilateral security deal which sank a French-designed submarine contract with Canberra.

    The rare decision taken by French President Emmanuel Macron was made due to the "exceptional gravity" of the matter, Foreign Minister Jean-Yves Le Drian said in a statement.

    On Thursday, Australia said it would scrap a $40 billion deal signed in 2016 for France's Naval Group to build a fleet of conventional submarines and would instead build at least eight nuclear-powered submarines with U.S. and British technology after striking a trilateral security partnership. France called it a stab in the back.

    A diplomatic source in France said it was the first time Paris had recalled its own ambassadors in this way.

    Australia said on Saturday morning it regretted the recall, and that it valued the relationship with France and would keep engaging with Paris on other issues.

    "Australia understands France's deep disappointment with our decision, which was taken in accordance with our clear and communicated national security interests," a spokesperson for Foreign Affairs Minister Marise Payne said in a statement.

    U.S. State Department spokesperson Ned Price said that France was a 'vital ally' and that the United States would be engaged in coming days to resolve the differences.

    The French foreign ministry statement made no mention of Britain, but the diplomatic source said France considered Britain had joined the deal in an opportunistic manner.

    "We don't need to hold consultations with our (British) ambassador to know what to make of it or to draw any conclusions," the source added.

    Le Drian said the deal was unacceptable.

    "The cancellation (of the project) ... and the announcement of a new partnership with the United States meant to launch studies on a possible future cooperation on nuclear-powered submarines, constitute unacceptable behavior between allies and partners," he said in a statement.

    He added that the consequences "directly affect the vision we have of our alliances, of our partnerships and of the importance of the Indo-Pacific for Europe."

    LOW POINT

    The row marks the lowest point in relations between Australia and France since 1995, when Canberra protested France's decision to resume nuclear testing in the South Pacific and recalled its ambassador for consultations.

    Australian Prime Minister Scott Morrison on Friday rejected French criticism that it had not been warned about the new deal, and said he had raised the possibility in talks with the French president that Australia might scrap the Naval Group deal.

    Morrison insisted he had told Macron in June that Australia had revised its thinking.

    "I made it very clear, we had a lengthy dinner there in Paris, about our very significant concerns about the capabilities of conventional submarines to deal with the new strategic environment we're faced with," he told 5aa Radio.

    "I made it very clear that this was a matter that Australia would need to make a decision on in our national interest."

    The strain in multilateral ties come as the United States and its allies seek additional support in Asia and the Pacific given concern about the rising influence of a more assertive China.

    France is about to take over the presidency of the European Union, which on Thursday released its strategy for the Indo-Pacific, pledging to seek a trade deal with Taiwan and to deploy more ships to keep sea routes open.

    U.S. Secretary of State Antony Blinken tried on Thursday to calm the French outcry, calling France a vital partner in the region.

    Pierre Morcos, a visiting fellow at Washington's Center for Strategic and International Studies, called France's move "historic."

    "Reassuring words such as those heard yesterday from Secretary Blinken are not enough for Paris - especially after French authorities learned that this agreement was months in the making," he said.

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    Default Re: In escalation over submarine deal, France recalls envoys from U.S. and Australia

    The nuclear option: why has Australia ditched the French submarine plan for the Aukus pact?

    Just two weeks before the bombshell, senior ministers from both countries met and declared they were ‘committed to cooperation’. How did it all go so wrong?

    17 Sep 2021

    Just two weeks before France complained of being “stabbed in the back”, two senior French ministers met with their Australian counterparts, Marise Payne and Peter Dutton, for what was meant to be a sign of ever-strengthening ties between the two countries.

    The joint statement they issued now seems extraordinary, given the events that followed. “Both sides committed to deepen defence industry cooperation and enhance their capability edge in the region,” they said. “Ministers underlined the importance of the future submarine program.”

    That meeting – now central to claims France was blindsided by what the Biden administration called “the biggest strategic step that Australia has taken in generations” – occurred by video conference on 30 August.

    Then on 15 September the Australian government formally notified the French government – just hours before the official announcement coordinated with Washington and London – that it was tearing up the $90bn contract with France’s Naval Group in favour of a new arrangement with the US and the UK to acquire nuclear-powered submarines.

    “We had established a relationship of trust with Australia – this trust has been betrayed,” said the French foreign minister, Jean-Yves Le Drian, who had been part of those apparently optimistic talks with Dutton and Payne two weeks earlier.

    So how did Australia’s largest ever defence acquisition go so badly off course? And what was France doing behind the scenes to reassure Australia to stick with the project?

    There must be something in the water

    To understand the French anger, we need to rewind a few years. Australia is no stranger to debacles over submarine programs – it seems to be the default.

    France is the second close partner of Australia to be burnt by the government’s approach to finding a replacement for the ageing Collins-class submarines.

    Tony Abbott had a close working relationship with the Japanese prime minister, Shinzo Abe, and was known to be keen on Japan building Australia’s future submarine fleet.

    But South Australian Liberal MPs were worried about shipbuilding jobs in that state, and raised the issue during internal discussions before Abbott faced a failed leadership spill motion in February 2015. Abbott promised a “competitive evaluation process” to shore up support from South Australian colleagues to help defeat that motion.

    The government specified that it was looking for options for diesel-electric submarines, not nuclear-powered submarines, which it didn’t believe it had the capacity to operate and maintain at that time. In addition to Japan’s proposal, the government also considered German and French bidders, with an emphasis on how to secure shipbuilding jobs in Australia.

    In 2016, Abbott’s successor Malcolm Turnbull announced France’s DCNS – now named Naval Group – had been selected “as our preferred international partner for the design of the 12 Future Submarines, subject to further discussions on commercial matters”.

    It took years to finalise the overarching strategic agreement, and the auditor-general found the Australian government had “increased the risk of this acquisition” by going for a tailored solution rather than buying submarines “off the shelf”.

    Government figures were becoming increasingly concerned about delays, cost blowouts, and a difficulty in securing firmer pledges for more substantial domestic industry involvement.

    From the outside, though, it appeared some progress was being made: in March this year, Payne, acting as defence minister, said the government had renegotiated the strategic partnering agreement so the company was required to “spend at least 60% of the contract value in Australia over the life of the program”.

    It has now emerged that secretive talks have been under way within the Australian government for at least 18 months about a potential “plan B” – sparking the French claims of betrayal, even as Scott Morrison insisted he had been upfront and acted in good faith to resolve the problems with the acquisition.

    Run silent, run deep

    The first step, from the Australian government’s perspective, was to find out whether another option was feasible. Morrison is not believed to have taken it up at a political level with the US while Donald Trump was still president and while Australia was still doing its homework.

    But Morrison made a series of personnel changes that would allow him to make a U-turn, amid growing concerns about China’s assertiveness and whether the project would provide the capability the Australian government believed it needed.

    Early this year, Morrison quietly set up a new cabinet subcommittee focused on naval shipbuilding, with himself as chair. This committee was created to feed advice back to the national security committee. Its remit included tracking whether the projects such as the future submarines were on track to deliver against agreed outcomes.

    Morrison also appointed the former chair of the National Shipbuilding Advisory Board, Prof Don Winter, as a special adviser to the prime minister, as the ABC reported at the time. Winter is a former US navy secretary who has previously conducted other reviews for the Australian government on troubled defence projects. Winter also chaired an oversight panel during the original submarine selection process in 2016.

    Commodore Timothy Brown, the defence department’s director-general of submarine capability, was also assigned a highly secretive project to examine “force structure requirements for undersea warfare” including submarines.

    He began that work for the chief of navy after the government released its defence strategic update mid last year – a document that warned that “major power competition, coercion and military modernisation are increasing the potential for and consequences of miscalculation”.

    The secretary of the defence department, Greg Moriarty, initially tried to block Brown’s appearance at Senate estimates in June this year, but he was allowed to attend the following day and give only broad details about his role.

    At the time, Moriarty insisted the government was “absolutely committed to trying to work through with Naval Group” to resolve challenges with the Attack class submarine program, but confirmed “prudent contingency planning” was under way.

    Troubled waters

    It is understood the secret conversations about a plan B picked up pace in March or April, first between Australia and the UK.

    Boris Johnson joined Morrison and Joe Biden for a trilateral meeting on the sidelines of the G7 summit in Cornwall in June, where the leaders discussed the defence cooperation plans and Australia’s request to share sensitive submarine technology in broad terms.

    A few days later Morrison met the French president, Emmanuel Macron, in Paris. Concerns about the submarine program were a key topic of discussion. Speaking to reporters shortly afterwards, Morrison did not rule out walking away from the project when the next contractual milestone was reached, but left the impression the sticking points were being resolved.

    Morrison said he appreciated the French president was “taking a very active role” resolving issues with the contract. “President Macron and I have a very, very open and very transparent, and very friendly relationship where we can speak candidly to each other about these issues,” Morrison said at the time.

    Morrison insisted this week he had been “very clear” during those talks with Macron that there were “very real issues” about whether conventional submarines were suited to the changing strategic environment in the Indo-Pacific. It’s not clear exactly how candidly these reservations were communicated, but there was no sign of alarm in the French president’s public remarks at the time. Macron said the French-delivered submarines would “reinforce the position of Australia and contribute to Australia’s sovereignty and strategic autonomy”.

    It is understood one of the outcomes of that meeting was that France, in a bid to reassure Australia that the project would not be delayed, was going to send Australia a letter affirming their commitment to the timelines and delivery of local content.

    An Australian government source said the letter arrived, but it was late. “If they can’t deliver a letter in time, how the hell can they deliver 12 subs on time,” the source said.

    Lobbying too little, too late

    Even if France did not realise Australia would really go as far as abandoning the entire project, there seemed to be an acceptance that it had a public relations problem in Australia. By June, Naval Group engaged David Gazard – a former adviser to John Howard and Peter Costello and a close friend of Morrison’s – “to provide government relations services”.

    Gazard’s company, DPG Advisory Solutions, was contracted “to provide government relations services and advice including organising meetings and communication between Naval Group and relevant Australian stakeholders including Federal politicians and Australian Government Ministers”.

    Former Liberal defence minister Robert Hill and former Labor leader Simon Crean were also engaged this year to provide strategic or stakeholder engagement advice, according to open disclosures to the government’s foreign influence register.

    But the outreach to MPs is believed to have been relatively “light touch”. In the end, it was too late to change the outcome.

    Insiders said because the government was pursuing two options in parallel, with final signoff on the “Aukus” defence pact secured relatively recently, the government still wanted to get the best deal possible with France, in case the US option fell over.

    Vice Admiral Jonathan Mead, who was also involved in reviewing the submarine program, travelled to Washington DC three weeks ago on Morrison’s instructions, according to the Australian Financial Review.

    After meeting with cabinet colleagues on Wednesday, the prime minister spoke to his party room on Thursday morning, after the details of the dramatic new course had been publicly announced by Morrison, Johnson and Biden.

    Although there were problems with the phone hookup, and the Coalition meeting was postponed, Morrison is understood to have first given a nod to backbench colleagues who would have wanted to be part of the discussions sooner.

    Morrison told colleagues he was sorry he hadn’t been able to do that, but the negotiations had been highly confidential.

    One of the sources of France’s irritation with what transpired this week, is that it has experience in nuclear submarine construction but was designing diesel-electric submarines based on the Australian government’s original specifications.

    The Australian version of the story is that the French nuclear-powered option requires complex work midway through the life of the submarine, meaning it would have required a more advanced domestic nuclear industry. The gamechanger was the US and UK willingness to share their technology.

    Dutton defended the government’s decision on Friday, saying in Washington that Australia “looked at what options were available to us” and “the French have a version which was not superior to that operated by the United States and the United Kingdom”.

    “In the end the decision that we have made is based on what is in the best interests of our national security and the prevailing security and peace within the Indo-Pacific,” Dutton said.

    The failed acquisition has burned up more than $2.4bn and is likely to cost hundreds of millions of dollars in contract break fees. There remain many unanswered questions about the new plan to build at least eight nuclear-powered submarines in Adelaide, but the first ones likely won’t be in the water until 2040 – an eternity in a region that the Australian government sees as becoming increasingly contested.

    Morrison told 3AW radio on Friday he understood the French government’s disappointment. “That is entirely understandable and reasonable and we’ll just have to work through that.”

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    Default Re: The nuclear option: why has Australia ditched the French submarine plan for the A

    ‘We thought we were mates’: French ambassador laments subterfuge en route to Sydney airport

    Jean-Pierre Thebault was angry about Aukus as he left Australia on Saturday night, saying: ‘It’s like in a couple, you know, when you commit … you don’t run away’

    19 Sep 2021

    The French ambassador to Australia was in a car heading to Sydney airport for an urgent flight back home when he revealed he was “sad like any decent person would be”.

    Jean-Pierre Thebault left Australia on Saturday night after Australia’s $90bn submarine deal with France was scrapped late last week, causing an unexpected rupture in the relationship between two friendly countries.

    “I’ve seen and learned how deep for an Australian it is when you commit to watch each other’s back. What makes me sad is that we thought we were mates and we were stabbed in the back,” Thebault told Guardian Australia on the way from Canberra to Sydney airport.

    The experienced diplomat was recalled to Paris, along with his counterpart in Washington, as the French government weighs up how to respond to what Biden administration officials called “the biggest strategic step that Australia has taken in generations”.

    That big step involved the US and the UK agreeing to share sensitive technology and help Australia build at least eight nuclear-powered submarines, a capability the allies say is needed to respond to growing concerns about China’s military assertiveness. The collateral damage from the deal – hatched among the Aukus allies in secret – was Australia’s existing plans with France’s Naval Group for 12 diesel-electric submarines.

    Thebault maintains France was not given any forewarning.

    There were Australian press reports earlier this year that the government was conducting a review that could result in the contract being terminated, amid concerns about cost increases and schedule slippages. In June, Australian defence officials told a Senate committee they were doing “prudent” contingency planning.

    But Thebault says “at no point, in no way” was France given “any clear signal that the contract would be brought to an end”. France thought those contractual issues were being resolved and conversations would continue.

    “I can only say that the sense of treason is very strong,” Thebault, who started his posting in Australia 10 months ago, said from the car.

    “And I use those words because of what has now transpired from apparently reliable sources, which have not received any official denial, that it was in process for 18 months. It was intentionally decided to keep France completely in the dark at the same time that several officials of Australia were not only discussing with France the current [submarine] program but were also saying they were willing to make this program a success and a symbol of the bilateral relationship.”

    Asked whether “treason” – meaning betraying one’s own country – was taking it too far, the ambassador said he didn’t mean it literally. He said the “sense of treason” was strong “because of lack of respect, and because of lack of transparency, because we were committed to a partnership”.

    “We are not speaking about normal contracts; we are speaking about a strategic partnership where France was sharing state military secrets with Australia and was committed to creating a sovereign industry in Australia according to the standards set by Australia,” Thebault said.

    “It’s like in a couple, you know, when you commit. After that, you have duties and opportunities … the duty is decency, the duty is transparency. If, for one reason or another, you feel that you have to change your mind, you say it – you don’t run away.”

    A defence source said the Australians first went to the UK’s Royal Navy to discuss Canberra’s desire to abandon the French contract and build nuclear-powered submarines with the UK and US instead. Having secured British support, the Australians then went to the Biden administration.

    It was left to the Australians to break the news to the French, but there seemed to be divisions in Canberra about the best way of going about it.

    “Some Australians wanted to ring up one week and say we’re so sorry, we’re putting out the diesel submarine contract, and ring up the next week, and say we just want you to know that we found a better submarine and it’s British,” the defence source said. “There was another school of thought that said: don’t do it like that. They’ll see through it and it will be worse because it will look duplicitous.”

    In the end, neither side won. The French were not told before details began to leak to the Australian and US media on Wednesday.

    The French president, Emmanuel Macron, welcomed the Australian prime minister, Scott Morrison, to Paris in June, with Macron declaring the French-delivered submarines would “reinforce the position of Australia and contribute to Australia’s sovereignty and strategic autonomy”.

    This was just days after Morrison joined the British prime minister, Boris Johnson, and the US president, Joe Biden, for a trilateral meeting on the sidelines of the G7 summit in Cornwall. It is now believed the three leaders discussed defence cooperation plans at that meeting leading to the eventual announcement of the so-called Aukus pact.

    Morrison told reporters on Thursday he had been “very clear” in the talks with Macron about “the strategic situation in the Indo-Pacific” and that there were “very real issues about whether a conventional submarine capability would be able to address those going forward”.

    Thebault – who was in Paris during that visit – offers this version: “The prime minister, to our understanding, signalled that there were questions raised about the evolving situation in the region … but what was agreed is that this conversation would continue.”

    Just two weeks before the Aukus announcement, Australian ministers Marise Payne and Peter Dutton met by video link with their French counterparts to herald ever-strengthening ties. According to the official joint statement, the four ministers “underlined the importance of the future submarine program”.

    Thebault – an experienced foreign affairs official who has served as ambassador to Ireland and who oversaw France’s preparations to host the G7 in 2018-19 – says the late August talks were “very positive and friendly” but it was now apparent there was “no sincerity in the discussion”.

    The timing is also a source of tension: France had been encouraging the European Union to adopt a “very, very active” Indo-Pacific policy. The EU’s announcement of its forward-leaning regional strategy coincided, Thebault says, with Australia revealing its decision “to renege on its word, commitment and signature”.

    “This can only have deep, deep impact, a long-term impact, not only on the bilateral relationship but also on the relations between Australia and European countries, and also, perhaps, more globally, because such an attitude and a way of treating a friend and ally is not something that will pass unnoticed.”

    The Australian government says it “notes with regret” France’s decision to recall its ambassador.Thebault is diplomatic when asked about that viewpoint. “I won’t comment on Australian politicians commenting on French elections,” he said, but also hinted at possible political considerations in Australia, too. Morrison is due to call a federal election by May.

    “I have also seen many reports in the press – and I don’t want to express any opinion about that – that maybe certain decisions in Australia are sometimes also taken with considering potential elections.”

    Thebault is coy about what needs to be done to repair the relationship between Canberra and Paris amid suggestions from French ministers that EU trade talks with Australia may be affected.

    “What will be the extent and the depth of the damages – this assessment is the reason for which I am recalled for consultation of France, where I’ll be able to discuss with relevant ministers and the authorities in order to get their advice, to give my feedback and to try to assess what can be done,” the ambassador said.

    “I just want to say that whatever decision will be taken, this in no way diminishes the very high esteem and appreciation that France has for Australia as a country – and for the Australians as friends, partners and allies.”

    Dutton on Sunday told Sky News he understood “that the French are upset at the cancellation of the contract”.

    “But in the end, our job is to act in our national interest, and suggestions that the concerns hadn’t been flagged by the Australian government defy, frankly, what’s on the public record and certainly what was said publicly over a long period of time.”

    The defence minister insisted Australia wanted to work “very closely with the French … into the future”. The prime minister on Sunday said the French were formally advised about 10 hours before Thursday morning’s press conference in Australia.

    Some Australian politicians believe France may have overreacted to the decision in part because of upcoming presidential elections, with Macron facing a first-round vote in April. “The French are about to go through an election season,” said Jason Falinski, a Sydney-based Liberal MP, who argues recalling the ambassadors “is what the French government needed to do in terms of sending a signal to their people” about standing up for French interests.

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    Default Re: The nuclear option: why has Australia ditched the French submarine plan for the A

    Australia had 'deep and grave' concerns about French submarines' capabilities, PM says

    By Jennifer Hauser and Ivana Kottasová, CNN

    September 19, 2021

    (CNN)Australia was concerned the conventional submarines it ordered from France would not meet its strategic needs before it canceled the multibillion defense deal in favor of an agreement with the United States and the United Kingdom earlier this week, Prime Minister Scott Morrison said Sunday.
    Seeking to explain the sudden U-turn that caused huge anger in Paris, Morrison said that while he understood France's disappointment over the issue, "Australia's national interest comes first."

    "It must come first and did come first and Australia's interests are best served by the trilateral partnership I've been able to form with President Biden and Prime Minister Johnson," he said at a news conference on Sunday.

    The decision by Australia to ditch the French deal and attain nuclear-powered submarines through a new agreement with the United States and the United Kingdom appeared to have taken France by surprise earlier this week.

    French government spokesperson Gabriel Attal said on Sunday that President Emmanuel Macron will hold a phone call with the US President Joe Biden in the next few days "to move forward."

    Speaking to the France 2 TV channel on Saturday, French foreign minister Jean-Yves Le Drian said the decision to scrap the deal that had been in the works since 2016 amounted to a "crisis."

    "There has been lying, duplicity, a major breach of trust and contempt. This will not do. Things are not going well between us, they're not going well at all," he said.
    In a sign of just serious the escalation was, France had recalled its ambassadors to the US and Australia for consultation in response to the announcement, the diplomatic equivalent of slamming the door shut following an argument.

    The cancellation of the deal has real economic consequences for France. French submarine builder Naval Group said 500 of its employees in Australia and a 650 in France are affected by the breakdown of the agreement.

    The company said Sunday it suspended its recruitment efforts in order to prioritize the needs of those affected by the contract coming to an end.

    But Morrison defended the decision on Sunday, saying there had been concerns about the deal with France even before it was canceled.

    "We had deep and grave concerns that the capability being delivered by the Attack-class submarine was not going to meet our strategic interests and we had made very clear that we would be making a decision based on our strategic national interest," he said.

    Le Drian also criticized the UK for its role in the deal, saying: "Great Britain, there is no need, we know their permanent opportunism, so there is no need to bring our ambassador to explain it to us. In fact, in this matter, Great Britain is a bit of a fifth wheel."

    UK's new Foreign Secretary Liz Truss said the UK was seeking to build partnerships with "like-minded countries." Writing in the Sunday Telegraph newspaper, she said the new deal with Australia and the US shows Britain's "readiness to be hard-headed in defending our interests and challenging unfair practices and malign acts."

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