Australia to pay French submarine builder for scrapped contract

Australian Prime Minister Anthony Albanese will fly to Paris seeking rapprochement with Emmanuel Macron after the French agreed to a lower-than -expected settlement over the cancellation of a $90-billion deal to purchase 12 submarines from the European nation. The Australian government on Saturday agreed to pay a French shipbuilder 830 million Australian dollars after tearing up a submarine contract. Albanese said he intended to have “an honest relationship with France and one that is based upon integrity and mutual respect”, and finalising the deal would allow the two countries to reset the “absolutely vital” relationship.“France is a key partner for Australia. We share those historical ties going back to the First World War and we share common interests in a stable Indo-Pacific region because France is, of course, an Indo-Pacific nation. New France Defence Minister Sebastien Lecornu welcomed the prospect of improved relations following the ousting of Morrison’s government. 

In September 2021, then-Australian prime minister Scott Morrison abruptly ripped up the French contract to build a dozen diesel-powered submarines. He also stunned Paris by announcing a secret deal 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.Since coming to office, Albanese has rushed to fix strained relations with France, New Zealand and with Pacific Island nations, who objected to the previous conservative government's foot dragging on climate change.