London Daily

Focus on the big picture.
Thursday, Sep 18, 2025

Australia agrees payout to end France submarine spat

Australia agrees payout to end France submarine spat

Canberra to pay $584m to French submarine maker ending dispute that soured relation between the two countries.

Australia has unveiled a substantial compensation deal with French submarine maker Naval Group, ending a contract dispute that soured relations between Canberra and Paris for almost a year.

Prime Minister Anthony Albanese said on Saturday that the French firm had agreed to a “fair and an equitable settlement” of 555 million euros ($584m) for Australia ending a 10-year-old multibillion-dollar submarine contract.

The agreement drew a line under a spat that caused leader-level recriminations and threatened to torpedo talks on a European Union-Australia trade agreement.

“It permits us to turn a page in our bilateral relations with Australia and look to the future,” said French defence minister Sebastien Lecornu.

Albanese said he would travel to France soon to “reset” a relationship beset by “pretty obvious” tensions.

The tussle began in September 2021, when Australia’s then-prime minister Scott Morrison abruptly ripped up a longstanding contract with the French state-backed Naval to build a dozen diesel-powered submarines.

He also stunned Paris by revealing secret talks to buy US or British nuclear-powered submarines, a major shift for a country with little domestic nuclear capability.

The decision drew fury from French President Emmanuel Macron, who publicly accused Morrison of lying and recalled his ambassador from Australia in protest.

Relations were on ice until this May when Australia elected centre-left leader Albanese.

Since coming to office, he has rushed to fix strained relations with France, New Zealand, and Pacific Island nations, who objected to the previous conservative government’s foot-dragging on climate change.

“We are re-establishing a better relationship between Australia and France,” Albanese said, after speaking to Macron about the settlement.

“I’m looking forward to taking up President Macron’s invitation to me to visit Paris at the earliest opportunity.”

Speaking on the sidelines of the Shangri-La Dialogue security summit in Singapore, Lecornu said France valued its “friendship” with Australia.

“Just because a government in the past did not keep its word, it does not mean we have to forget our strategic relationship,” he said.

“Australia has a new team in power, we are happy to be able to work with them.”




The submarine contract had been the centrepiece of Australia’s race to develop its military capabilities, as it fears the threat from a more bellicose China under President Xi Jinping.

In total, the failed French submarine contract will have cost Australian taxpayers $2.4bn, Albanese said, with almost nothing to show for it.

The promised nuclear-powered submarines are likely to cost many billions more, but would give Australia the ability to operate more stealthily and – armed with sophisticated cruise missile capabilities – pose much more of a deterrent to Beijing.

But there remains deep uncertainty about how quickly they can be built.

The first US or British submarines likely will not be in the water for decades, leaving a long capability gap as Australia’s existing fleet ages.

The choice of contractor will have a significant economic effect and strategic implications, closely enmeshing the Australian navy with that of the chosen nation.

Meanwhile, Albanese has also made tentative steps to conduct the first ministerial-level talks with China in more than two years, after a range of bitter political and trade disputes.

Defence minister Richard Marles said in Singapore on Saturday that Australia wanted “respectful” relations with all countries in the region, adding: “This includes China.”

“Australia values a productive relationship with China. China is not going anywhere. And we all need to live together and, hopefully, prosper together,” he said.

Marles, however, rejected a pointed question from a Chinese military official who asked if the so-called AUKUS deal with the United States and the UK to supply submarine technology was a new defence alliance.

“AUKUS is not a mini-NATO,” Marles said. “It’s not an alliance.”



Newsletter

Related Articles

0:00
0:00
Close
US Tech Giants Pledge Billions to UK AI Infrastructure Following Starmer's Call
Saudi Arabia cracks down on music ‘lounges’ after conservative backlash
DeepMind and OpenAI Achieve Gold at ‘Coding Olympics’ in AI Milestone
SEC Allows Public Companies to Block Investors from Class-Action Lawsuits
Saudi Arabia Signs ‘Strategic Mutual Defence’ Pact with Pakistan, Marking First Arab State to Gain Indirect Access to Nuclear Strike Capabilities in the Region
Federal Reserve Cuts Rates by Quarter Point and Signals More to Come
Effective and Impressive Generation Z Protest: Images from the Riots in Nepal
European manufacturers against ban on polluting cars: "The industry may collapse"
Sam Altman sells the 'Wedding Estate' in Hawaii for 49 million dollars
Trump: Cancel quarterly company reports and settle for reporting once every six months
Turkish car manufacturer Togg Enters German Market with 5-Star Electric Sedan and SUV to Challenge European EV Brands
US Launches New Pilot Program to Accelerate eVTOL Air Taxi Deployment
Christian Brueckner Released from German Prison after Serving Unrelated Sentence
World’s Longest Direct Flight China Eastern to Launch 29-Hour Shanghai–Buenos Aires Direct Flight via Auckland in December
New OpenAI Study Finds Majority of ChatGPT Use Is Personal, Not Professional
Hong Kong Industry Group Calls for HK$20 Billion Support Fund to Ease Property Market Stress
Joe Biden’s Post-Presidency Speaking Fees Face Weak Demand amid Corporate Reluctance
Charlie Kirk's murder will break the left's hateful cancel tactics
Kash Patel erupts at ‘buffoon’ Sen. Adam Schiff over Russiagate: ‘You are the biggest fraud’
Homeland Security says Emmy speech ‘fanning the flames of hatred’ after Einbinder’s ‘F— ICE’ remark
Charlie Kirk’s Alleged Assassin Tyler Robinson Faces Death Penalty as Charges Formally Announced
Actor, director, environmentalist Robert Redford dies at 89
The conservative right spreads westward: a huge achievement for 'Alternative for Germany' in local elections
JD Vance Says There Is “No Unity” with Those Who Celebrate Charlie Kirk’s Killing, and he is right!
Trump sues the 'New York Times' for an astronomical sum of 15 billion dollars
Florida Hospital Welcomes Its Largest-Ever Baby: Annan, Nearly Fourteen Pounds at Birth
U.S. and Britain Poised to Finalize Over $10 Billion in High-Tech, Nuclear and Defense Deals During Trump State Visit
China Finds Nvidia Violated Antitrust Laws in Mellanox Deal, Deepens Trade Tensions with US
US Air Force Begins Modifications on Qatar-Donated Jet Amid Plans to Use It as Air Force One
Pope Leo Warns of Societal Crisis Over Mega-CEO Pay, Citing Tesla’s Proposed Trillion-Dollar Package
Poland Green-Lights NATO Deployment in Response to Major Russian Drone Incursion
Elon Musk Retakes Lead as World’s Richest After Brief Ellison Surge
U.S. and China Agree on Framework to Shift TikTok to American Ownership
London Daily Podcast: London Massive Pro Democracy Rally, Musk Support, UK Economic Data and Premier League Results Mark Eventful Weekend
This Week in AI: Meta’s Superintelligence Push, xAI’s Ten Billion-Dollar Raise, Genesis AI’s Robotics Ambitions, Microsoft Restructuring, Amazon’s Million-Robot Milestone, and Google’s AlphaGenome Update
Le Pen Tightens the Pressure on Macron as France Edges Toward Political Breakdown
Musk calls for new UK government at huge pro-democracy rally in London, but Britons have been brainwashed to obey instead of fighting for their human rights
Elon Musk responds to post calling for the murder of Erika Kirk, widow of Charlie Kirk: 'Either we fight back or they will kill us'
Czech Republic signs €1.34 billion contract for Leopard 2A8 main battle tanks with delivery from 2028
USA: Office Depot Employees Refused to Print Poster in Memory of Charlie Kirk – and Were Fired
Proposed U.S. Bill Would Allow Civil Suits Against Judges Who Release Repeat Violent Offenders
Penske Media Sues Google Over “AI Overviews,” Claiming It Uses Journalism Without Consent and Destroys Traffic
Indian Student Engineers Propose “Project REBIRTH” to Protect Aircraft from Crashes Using AI, Airbags and Smart Materials
French Debt Downgrade Piles Pressure on Macron’s New Prime Minister
US and UK Near Tech, Nuclear and Whisky Deals Ahead of Trump Trip
One in Three Europeans Now Uses TikTok, According to the Chinese Tech Giant
Could AI Nursing Robots Help Healthcare Staffing Shortages?
NATO Deploys ‘Eastern Sentry’ After Russian Drones Violate Polish Airspace
Anesthesiologist Left Operation Mid-Surgery to Have Sex with Nurse
Tens of Thousands of Young Chinese Get Up Every Morning and Go to Work Where They Do Nothing
×