Australia’s decision to pull out of its $65 billion submarine deal with France was seen by the government, people, and opposition of France as an unacceptable slap and a stab in the back. France felt slighted and humiliated in an unprecedented way since the British ultimatum to it to leave Sudan in the late 19th century.
For several reasons, Paris sees its escalation justifiable. On one hand, the Washington, London, and the Canberra alliance was the outcome of months-long negotiations and consultations to which France wasn’t invited nor informed of, and naturally its opinion wasn’t sought.
In a statement to Le Figaro, a French source noted: “Any country reserves the right to cancel a deal in its best interests… but what happened is that we have been deceived and manipulated for a year and a half” (the duration since Australia started thinking of an alternative. Talks with the United Kingdom started in March 2021 and both sides approached Biden to inform him of the matter last June).
On the other hand, France says that the deal violates an unwritten rule that Paris has held into, i.e. impermissibility of transferring nuclear propulsion technology to countries that don’t have it. Meaning there is some kind of unfair competition, with the United States establishing norms and then changing them without notice when it could perceive an interest. However, a number of French news reports undermined this argument, stating that France, months ago, offered to revise the deal to provide nuclear submarines, but the Australian Prime Minister claimed his country prefers the deal to remain as is.
On the opposite side, the Australians argued that France hasn’t abided by the terms nor kept to the delivery schedule for some milestones. Further, the cost of the deal nearly doubled to reach over $60 billion, up from $35 billion. They claim that the French didn’t take the bilateral military cooperation seriously and dealt with it as a marginal and secondary concern.
In response to these claims, the French pointed out that Macron has explained France’s strategy in the region during a visit to Australia, but the latter insisted that 60 percent of the materials and tools be made in France and it hadn’t had the industrial base that would make this happen. Thus, they see it is Australia that takes responsibility for the delay. For its part, France said that agreeing to this condition was a mistake as it resulted in reducing its profit margin, adding that “ill-intent” was evident when the Australian Prime Minister started talking about the environmental impact of the project.
And whatever the case is, the war of words shows that the personal trust between the leaders of the two countries had been missing, and this undoubtedly must have played a major role in the ensuing developments.
Reasons for France’s Anger
Paris’s anger was also motivated by other factors. As far as its defense and military policies are concerned, France realizes the need to retain its nuclear deterrent and all of its regular forces (land, sea, air), has abolished compulsory military service causing the military to consist primarily of military professionals, and has solidified its military-industrial/technological base. However, such a base isn’t likely to advance if the French army was the only buyer of its products, meaning exporting was a matter of survival for this industrial base. From that perspective, the Australian deal was a “slam dunk”. While French sources indicate that the Naval Group will recover, there is no question that its leaders are still traumatized.
Moreover, France’s submarine deal with Australia and the consequent deepening of military cooperation were a constituent pillar of France’s strategy in the Pacific Ocean, a strategy that could suffer another blow at the end of the year if New Caledonia (located east of Australia) voted on becoming independent from France in the referendum planned at the end of the year. French experts see that independence of New Caledonia will mean its rapprochement – or even alliance – with China, the latter being in need of the island’s mineral resources. A report by the French Institute for Strategic Research at the Military School (IRSEM) accused China of supporting independence movements.
Space is too limited to go into further details of the Australian perspective and discuss its reasoning, but it would be enough to say that the deal was signed in 2016 in a time the two parties where careful to develop relations with China or at least not to jeopardize it while a adopting a shared diplomatic agenda, i.e. “rejection of high-handedness of one side over the other”. However, the situation has changed radically with the severe deterioration in the bilateral Australian-Chinese relations. Australia wasn’t willing to choose between Washington and Beijing but realized that neutrality was no longer possible and that the French protection needed to be replaced by a more powerful protection, even if the new alliance would detract from its sovereignty and cause its ports to be turned into US military bases. Overall, Australia’s decision to rely on the United Kingdom and the United States is more consistent with its defense and security policies notwithstanding the fact that this provoked a crisis with France and New Zealand that rejects allowing nuclear submarines into its territorial waters.
France’s Response
Returning to France, a salient feature of the crisis was the public opinion calling for a quick and strong response, while, indeed, forethought and prudence were much-needed. It wouldn’t be possible to review all that has been said and enough to say that some demanded France’s withdrawal from NATO –an option that the Minister of Defense ruled out decisively in an interview published by Le Monde on 25 September–, some called for imposing sanctions on Australia (by using the veto to prevent signing agreements between it and the European Union) and the United Kingdom (cancellation of joint meetings), and some lamented the decline of France’s prestige and status, complaining the “treachery” of the United States. The French Foreign Minister resembled President Biden’s policies to those of his predecessor Trump.
French observers differed on positions of European countries with some seeing it as weak and faint while others saw it as strong and clear, albeit coming under French pressures and after Paris portrayed what happened as an affront to all of Europe. Further, there are some who appraised positions of both the President of the European Commission and the EU Representative for Foreign Affairs and Security Policy. Many, however, condemned the German position that combined a verbal condemnation of what happened and a prompt signing of a military cooperation pact with Australia in the days following the outbreak of the crisis. This position has been interpreted as reflecting a schadenfreude as Germany has been competing with France in 2016 to secure the submarine deal.
Despite this, it went unnoticed – to the best of my knowledge – that, in the ordinary case, France’s foreign policy is not always in permanent disagreement with Washington. France’s discourse of rejecting hegemony can only be seen as being anti-American in most cases. Indeed, Paris gives to its interlocutors the impression that its conception of European strategic independence is directed against Washington’s hegemony.
At the highest state level, President Macron’s management of the crisis has been characterized by wisdom. Initially, he kept silent, tasked Ministers of Foreign Affairs and Defense to express the French anger, contacted the European allies, and took measures – ranging from being symbolic as has been evidenced by the cancelation of a dance party in the United States to being more serious as has been demonstrated by summoning France’s ambassadors to the US and Australia and cancellation or postponement of big bilateral meetings – against the three countries forming the new alliance, and took time thinking of alternatives before he made a phone call to Biden expressing his resentment.
Gradually, France’s response to the consequences of the AUKUS Submarine Deal started to take shape, particularly after publishing a statement of Macron’s phone call with Biden.
First, the crisis has been branded as being a slap in the face for the entire Europe and not only France. It was stressed that the US behavior reflects degradation of the EU countries and proves that the US can’t be relied upon. Additionally, the US behavior was seen as an indicator of the US growing interest in the Indo-Pacific and the declining importance of Europe to the US. This –according to the official French statement – requires that Europe achieves strategic independence expeditiously.
The Joint Statement of the United States and France stated that Macron and Biden recognize “the importance of a stronger and more capable European defense that contributes positively to transatlantic and global security and is complementary to NATO”. Some French media considered this statement a “diplomatic” victory for Macron. According to them, the US recognition of the need for a capable European defense removes a major impediment standing in Europe’s way towards strategic independence. France interprets the European reluctance to its perceptions by fear of aggravating the United States, the principal guarantor for European security. Thus, they believe the US recognition will contribute to convincing European countries of the soundness of Paris’ analyses and projects.
As far as I can tell, this analysis doesn’t seem to be well-thought out. On one hand, the United States needs a stronger Europe capable of protecting itself so that Washington can focus on the Indo-Pacific region. So, the US recognition of the importance of a “capable European defense” (the statement didn’t make any mention of “strategic independence”) can’t be considered as a transformation in the US attitude. Washington has well-founded doubts about the capability and willingness of Europeans to develop their armed forces. On the other hand, the European reluctance on France’s agenda can’t be attributed only to fear of Washington.
Occasionally, France behaves as if it doesn’t realize it is no longer a superpower, unaware that the United States is currently the most powerful guarantor for European security. Further, in its foreign practices, France gives other European countries, particularly eastern and northern European states, the impression that it doesn’t care about their interests while it seek at the same time to have all of Europe serve objectives of its policy, unable to perceive the possibility of Europe drawing up a unified policy that is inconsistent with that of France. The last two points are unjust to France; however, the many infelicitous statements by French officials justify the perceptions and apprehensions of others.
Notably President Biden stressed, in the joint statement, the US commitment to reinforce its support to counter-terrorism operations in the Sahel conducted by European states and underscored the importance of a European engagement in the Indo-Pacific region, an engagement the features of which were outlined in an EU strategic document.
Second, France is looking for regional partners (other than Australia) in the Indo-Pacific region as well as partners interested in entering into arms deals with it. Obvious candidates in this respect are India and Indonesia. Towards that, Macron made a telephone call to the Prime Minister of India, and an official statement by the latter said that Macron affirmed France’s commitment to strengthening India’s strategic autonomy, including its industry and technology base, as part of a close relationship based on trust and mutual respect. The statement said that the two countries will work towards promoting regional stability and the rule of law, while ruling out any form of hegemony. Indeed, this last sentence about the “hegemony” is used repetitively by France to say that dealing with the United States means being dominated with it.
It should be recalled that the military relations between France and India have witnessed a surge over the past few years where India purchased Rafale jets from France, France allowed Indian Navy to use its bases in the UAE, Djibouti, and the Rénion Island, and both countries carried out joint military drills.
Internal Vulnerability
In view of the above, preliminary responses to the crisis embodied in trying to capitalize on the incident to squeeze concessions from Washington, urge EU countries to strengthen the defense system, and look for partners replacing Australia. While the concerned departments were still in shock, they have started reflecting on problems that have emerged with the “treachery” (a term used by le Figaro), including primarily:
1. Failure of state agencies to track the secret negotiations conducted between Canberra, London, and Washington. Public officials justified this failure by the secrecy that featured these negotiations and the limited number of persons involved in them, i.e. four or five representatives of each country. However, the question remains as to how this happened.
2. Performance of the defense industry leadership and senior personnel. The defense industry leadership were unable to build strong personal relationships with the Australian side and signed the contract despite the difficulty of implementing some or most of its provisions in a timely manner, which gave the Australians the impression of lack of seriousness and interest.
3. Dealing with the new reality following the demise of the agreement on impermissibility of transferring nuclear propulsion technology. This poses a twofold question. First, what are the risks of the new situation, particularly with regard to engines operating with nuclear (highly enriched uranium) fuel? Meaning, how will France deal with Russia and Iran if the former decided to sell nuclear submarines to the latter (International Conventions aren’t an obstacle to this)? How can the use of highly enriched uranium in nuclear submarines be monitored? Second, can France capitalize on the new situation to sell nuclear submarines? And for whom? Sources expected these issues to be a prime focus of the call between Macron and Biden, but the final statement did not touch upon it.
4. Raising the issue of Europeanization of the military industrial/technological bases of European countries. Some military industrialists say that Anglo-Saxon countries would not have dared to act so lightly had the contract been signed between the European Union and Australia. They recognize the many difficulties hindering Europeanization, including sensitivities of the military institutions that uphold state sovereignty and the differing structures of European military companies in various European countries. For example, the German company that manufactures submarines is family-owned, while the French state holds stakes in the French military companies. Also, there are deep-seated differences over patent property rights and standards regulating the sale process, among others. However, military cadres say that it would be a mistake not to discuss this issue now as it would be hard to rectify.
