French submarine deal snub reflects Australia's need for better technology to counter China

French officials have been in an uproar since Australia dropped $66B contract

The widening diplomatic spat over Australia’s canceled submarine deal with France highlighted a key strategic shift in the West, with the United States and its allies willing to snub a key European partner to counteract China’s aggression in the Pacific Ocean.

French officials have been in an uproar since Australia dropped the $66 billion contract for 12 conventional submarines in favor of a nuclear submarine pact with the United States and Britain. Australian officials, who had expressed concerns about budget overruns and delays in the French deal, said the nuclear submarines were a technological necessity to defend the country’s interests.

Australia’s decision to partner with the U.S. and U.K. over France also signaled its strategic view toward China has changed "very dramatically" since the contract was awarded in 2016, according to Ivo Daalder, who served as U.S. ambassador to NATO from 2009 to 2013. Relations with China have deteriorated over Beijing’s handling of the COVID-19 pandemic, actions in the South China Sea and efforts to control trade in the Pacific.

"Frankly, [Australia] wanted to bind the U.S. into the Pacific as well and this is another way to do that," Daalder told Fox News. "The strategic rationale for going with the UK-U.S. was much more significant than going with the French."

"The conventional subs were just not going to do the job," he added.

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Australia will receive at least eight nuclear-powered submarines in the agreement by 2040. Aside from infuriating France, which will lose billions in expected revenue and $1.7 billion in sunk costs, the deal angered China, which ripped the U.S. and Britain for sharing highly sensitive nuclear technology.

Nuclear-powered submarines have several operational advantages over the submarines Australia would have received under the original deal with the French. The U.S.-made vessels can last decades without a need to refuel, have greater range and are more difficult to detect than their conventional counterparts. The French-made vessels were a nuclear submarine design converted to operate as diesel-electric hybrids.

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"The delays, that could probably be worked out," said Garret Martin, co-director of the Transatlantic Policy Center at American University. "But China’s behavior and the economic coercion against Australia and others, I think, created a real sense of urgency and real domestic pressure. (Australia has) a lot of sea coast to defend, and the Pacific Ocean is massive, so having that long range made a big difference for them."

While the accord between Australia, the United States and the United Kingdom was negotiated in secret, Australian Prime Minister Scott Morrison said France was aware his government had "deep and grave concerns" that the conventional submarines would not meet its defense needs. 

French officials have pushed back on Australia’s claim, arguing the country’s government gave no public indication that they had misgivings about the submarine contract. 

"The United States carries more clout in the region and everywhere than France does. On a purely strategic standpoint, that is understandable," said Ben Haddad, director of the Atlantic Council’s Europe Center. "I think what’s been really frustrating to Paris is that Australians have not been forthcoming about their misgivings and certainly not open about the fact that they were about to turn to another partner."

Public statements suggested the deal was stable as recently as Aug. 30, when French and Australian defense and foreign affairs officials issued joint remarks referring to the "importance of the Future Submarine program" and plans to "strengthen military scientific research cooperation."

In this photo provided by U.S. Navy, the Los Angeles-class fast attack submarine USS Oklahoma City (SSN 723) returns to U.S. Naval Base in Guam, Aug. 19, 2021. (Mass Communication Specialist 3rd Class Naomi Johnson/U.S. Navy via AP)

In this photo provided by U.S. Navy, the Los Angeles-class fast attack submarine USS Oklahoma City (SSN 723) returns to U.S. Naval Base in Guam, Aug. 19, 2021. (Mass Communication Specialist 3rd Class Naomi Johnson/U.S. Navy via AP)

"There is a crisis of trust beyond the fact that the contract is being broken, as if Europe itself didn’t have any interest to defend in that region," French Foreign Minister Jean-Yves Le Drian said at the United Nations on Monday.

Top Australian officials argued the change of heart was necessary to protect the country’s "narrowing" technological edge in the Indo-Pacific region, where China’s naval capabilities include nuclear submarines. 

Last week, Morrison said the country was "not in a position" to pursue nuclear submarines when it signed the original deal in 2016.

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"It wasn't on the table for a range of reasons," Morrison said. "So, the decision we have made to not continue with the Attack class submarine and to go down this path is not a change of mind, it's a change of need."

President Biden has requested a phone call with French President Emmanuel Macron in the coming days to resolve the dispute, a senior Biden administration said. Any lingering tensions could undermine Biden’s pledge to closely cooperate with European allies following tumultuous relations under former President Trump.

"My sense from the Biden administration is that really, it speaks volumes about how important countering China is, even if it means ruffling the feathers of a major ally in Europe," Martin added.