Paris-Canberra Sub Deal Row Unlikely to Have Long-Term Effect on Australia’s Ties With EU

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Luc Rivet – Australia’s move to choose a defense and security partnership with the United States and the United Kingdom over an arms deal with France will hardly affect its long-term relations with the EU, as Paris is alone in pressing to stop trade talks between Canberra and Brussels, experts told Sputnik.

Last week, Paris recalled its ambassador from Canberra and Washington, after Australia chose to quit a $66 billion submarine contract with France to instead obtain nuclear-powered submarines via a new trilateral partnership, dubbed AUKUS. French Foreign Minister Jean-Yves Le Drian described Australia’s withdrawing from the contract as a “stab in the back.” As France demands compensation from Australia, it exerts pressure on the EU to stop negotiating an expected trade deal with Canberra.

The situation around the submarine contract is not the first such example when one of the partners quit the deal, opting for a more beneficial agreement, Xavier Moreau, a French arms expert, told Sputnik, adding that international arms contracts are not “black-and-white clear-cut.”

A similar incident took place between Qatar and France, the expert, who was once an executive at the state-owned Nexter weapons manufacturer, recalled. The Nexter group had proposed their armored infantry transporter VBCI to Qatar in association with the German Krauss-Maffei. But in December 2020, Qatar surprisingly abandons the contract for 490 armored combat vehicles worth 2 billion euros ($2.3 million) with the French-German consortium and chooses instead the German Boxer vehicle.

“Companies work with each other across borders, so it is not only a game with ‘national champions.’ It is much more complicated,” Moreau stressed.

The expert believes that no European country will accept to sacrifice its long-term future business opportunities with Australia to act in solidarity with France and support a moratorium on trade talks.

“The German support to France within the European Commission will be limited to a show of force in the present negotiations with Australia. The resumption of this trade relations round will simply be postponed,” Moreau added.

He stressed that this moratorium would be “short-lived,” adding that France is alone in taking a “last stand.”

Commenting on France’s stance on the situation, Emmanuel Dupuy, the head of the Paris-based Institute for Prospective and Security in Europe (IPSE), told Sputnik that Paris expressed very clearly that Australia is not a major economic partner for Europe. The expert, in particular, referred to a recent remark by French Secretary of State for European Affairs Clement Beaune, who told Politico that given Canberra’s move, a trade deal between Australia and the EU is “unthinkable.”

“France will oppose the European trade agreement which is being negotiated with Australia. The conditions for a calm debate are not met and France will obtain a moratorium; 250 million euros [$293.4 million] offered in compensation for canceling the submarine contract by Australia is clearly insufficient. It is true that trade between Europe and Australia is weak, which makes a European agreement even more certain. It is true that countries which trade with the whole world like the Netherlands, Denmark or Sweden are not very happy about this, but Europe will come out with a unanimous position,” Dupuy said.

The expert believes that the current row rather opens opportunities for the bloc, noting that a European strategy in the Indo-Pacific area becomes a necessity, as the EU can benefit from growing US-China tensions.

“The European geopolitical position, presented by … [EU foreign policy chief] Josep Borrell is of course bothered by the Australian problem, but a European strategy in the Indo-Pacific area becomes a necessity, as countries in the region view with apprehension the growing tensions between America and China. America focuses on China and abandons confrontation with Russia; French and European autonomy can benefit from it,” he said.

Though Borrell expressed regrets that the new defense partnership excluded European nations, Dupuy believes Europe will now have more freedom to negotiate separately with China and Iran.

“If America changes focus within NATO and abandons priority to the North Atlantic, in order to consider collective security focused on the Pacific ocean, Europeans will become aware of their fragility in Europe and will seek more dialogue with Moscow, which is at a standstill today,” Dupuy concluded.

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