Submarine crisis: trade negotiations between Australia and Europe interrupted

Long-planned negotiations on a possible free trade agreement (FTA) between Australia and the European Union (EU) have been postponed, said on Friday 1er October a European official, after the fury over Canberra’s decision to cancel a major contract for French submarines. “The trade cycle of the FTA has been postponed for a month until November”, an EU official in Canberra told Agence France-Presse (AFP), casting doubt on the future of this pact.

Australian Trade Minister Dan Tehan, who was due to travel to Europe for the negotiations, played down the decision in a statement to Agence France-Presse. “We understand France’s reaction to our decision on submarines, but at the end of the day every nation must act in its national interest. what Australia did ”, did he declare.

Mr Tehan added that he planned to meet with EU Trade Commissioner Valdis Dombrovskis next week. “We will continue to prepare for the twelfth round of negotiations and work towards a free trade agreement that is in the interests of Australia and the EU”, said Mr. Tehan.

Last month, Australia without warning severed the contract to purchase twelve French conventional-propelled submarines for a value of A $ 90 billion (€ 55 billion), choosing to buy from the instead of nuclear-powered ships of American design. In the wake of this agreement, the creation of a strategic alliance between the United States, the United Kingdom and Australia in the Indo-Pacific, called “Aukus”, from which France was kept apart, has been announced.

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62 billion euros in trade

The move sparked a major diplomatic conflict with France, which has publicly declared that it can no longer trust the Australian government, accusing officials of lying and questioning the continuation of the trade deal.

The French government has recalled its ambassadors from Canberra and Washington, a rare measure, to protest against the behavior of the allies. The French ambassador returned to the United States on Wednesday, but nothing suggests for the moment that the Australian ambassador, Jean-Pierre Thébault, will return.

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Former Australian Prime Minister Malcolm Turnbull said this week his successor had “Deliberately deceived” France by abandoning the agreement. Prime Minister Scott Morrison “Did not act in good faith”Mr Turnbull told reporters in Canberra. “France believes it has been deceived and humiliated, and it has been. This betrayal of trust will mark our relations with Europe for years to come ”, he judged.

The EU is Australia’s third largest trading partner. In 2020, trade in goods between the two economies was valued at 36 billion euros and 26 billion euros for services. The next round of negotiations was to cover areas such as trade, services, investment and intellectual property rights. Trade talks began in 2018 and negotiators hoped to reach a deal by the end of the year. But with Australia and France both heading for elections in early 2022, that timeline now looks optimistic.

The World with AFP

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