Australia to break mega contract with France

Australia to break mega contract with France
Australia to break mega contract with France

– What contract is it?

It had to be the “contract of the century”. In April 2016, Australian Prime Minister Malcolm Turnbull announced the award of a giant contract for twelve conventional submarines to the French shipbuilder Naval Group (ex-DCNS), these submarines to be built in Australia. The price: $ 50 billion. The biggest military contract in the country’s history.

« The recommendations of our evaluation committee, the Ministry of Defense and experts were unequivocal on the fact that the French offer was best able to meet the specific demands of Australia. Malcolm Turnbull said at the time.

In 2016, the Minister of Defense Jean-Yves Le Drian assured that this contract would represent ” thousands of jobs »In France, particularly in Cherbourg, Lorient, Brest and Nantes.

– What will Australia announce?

Almost five years later, the affair could become “the failure of the century”. According to information from the Australian press, confirmed this Wednesday evening by some French media, Australia will formalize the death of this mega contract Thursday morning.

In the process, the country will announce the signing of a new partnership with the United States and Great Britain. Joe Biden is due to speak on the matter at 7 a.m. Australian time. According to ABC News, the Australian decision has already been transmitted to Paris.

– Why has Australia changed its mind?

According to Financial Review, this decision would be justified by the fact that the transition to nuclear technology had become ” necessary ”, In particular because of the growing aggressiveness of China in the region.

The submarines sold by France were diesel / electric powered. But according to La Tribune, Australia did not want nuclear submarines at the time, although Naval Group could provide them.

In recent years, Australian criticism has multiplied against this contract, in particular because of the years of delay and the additional costs estimated at 40 billion dollars, for a total amount of 90 billion dollars. Last June, the media revealed that Australia was working on a plan B. Naval Group even had until September to refine its project. Australia will therefore not have waited.

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