Tuesday, October 26, 2021

EU suspends trade talks with Australia after submarine dispute

Discussions of a trade deal between the EU and Australia have been suspended as Australian trade ministers fly to the continent.

The move comes after French outrage over Canberra’s decision to scrap a $90 billion (US$64 billion) submarine project, following the signing of the AUKUS agreement with the United States and the United Kingdom (UK) last month.

“I will meet with my EU counterpart Valdis Dombrowski next week to discuss the 12th negotiating round, which will now take place in November instead of October,” Australian Trade Minister Dan Tehan said in a statement to Reuters on 1 October.

“A free trade agreement is in the interests of Australia and the EU and will strengthen our relationship that is built on a shared commitment to democracy, human rights, the rule of law and economic openness,” he said.

“We understand the French reaction to our submarine decision, but ultimately any nation must act in its own national interest – which is what Australia has done.”

Last month, the Australian government scrapped the troubled multi-billion dollar Future Submarine program with French defense contractor Naval Group.

The original 2016 plan was for the Navy to convert its 12 Barracuda-class nuclear submarines into diesel-electric powered attack-class submarines equipped with US weapons systems.

However, the French project has been riddled with ongoing delays and cost overruns, with Australian Prime Minister Scott Morrison revealing $2.4 billion (US$1.7 billion) was already sunk in the project.

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However, signing AUKUS saw Australians cancel the deal – which Morrison said was within the authority of the federal government – and instead seek the acquisition of at least eight nuclear-powered submarines from the United States or the United Kingdom.

French ministers reacted angrily to the deal, accusing Australia and the United States of “stabbing them in the back” and recalling their ambassadors from Canberra and Washington DC.

European Commission President Ursula von der Leyen also questioned whether the incident could affect a potential trade deal with Australia.

In reaction to the delay in EU-Australia trade talks, Euan Graham, senior fellow for Asia-Pacific security at the International Institute for Strategic Studies, wrote Twitter on October 1st, “Amazing. I guess economic retaliation was not in EU Indo-Pacific policy guidelines?”

“What is the condition that this suspension was given in time to enable (French President Emmanuel) Macron to lobby an incoming German government for a supportive EU status?” she added. “It will be interesting to see whether Australia now expeditiously negotiates a (Australia-United Kingdom) free trade agreement.”

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This News Originally From – The Epoch Times

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