In 2021, Australian Prime Minister Scott Morrison had scuttled contract delivery of French submarines worth 56 billion euros, preferring to supply after Washington and London.
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A very costly flip-flop. Australia will be forced to pay up to 5.5 billion Australian dollars (3.7 billion euros) for ending a deal with France over the supply of submarines, Australian officials have admitted, Friday, April 1.
>> The article to read to understand the diplomatic crisis after the breach of the “contract of the century” of Australian submarines
Last year, Australian Prime Minister Scott Morrison scuttled a contract worth 56 billion euros with the French group Naval Group, preferring to supply Washington and London, as part of a historic agreement.
When questioned by an opposition senator on Friday, Australian defense officials revealed that abandoning the French deal came at a steep price. “So taxpayers will have to shell out $5.5 billion for submarines that don’t exist?” asked Senator Penny Wong during a hearing in Canberra. “The final negotiated settlement will be within this price”replied the deputy secretary of the Ministry of Defense, Tony Dalton.
Tony Dalton said the exact amount was not yet clear as negotiations with Naval Group were ongoing. Finance Minister Simon Birmingham defended the decision to abandon the French deal as “necessary for decades to come”.
Scott Morrison previously said the decision to opt for nuclear-powered submarines with the UK and US, rather than conventional submarines with France, was driven by changing dynamics. in the Asia-Pacific region, where China is increasingly asserting its claims to nearly all of the South China Sea.