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Australia pays 555 million euros to Naval Group and reconciles with France

“We have reached a fair and just settlement of 555 million euros (approximately $830 million) with Naval Group”, Australian Prime Minister Anthony Albanese announced overnight from Friday to Saturday. With the end of negotiations between Naval Group and Canberra on the “rest to be paid” within the framework of the Franco-American submarine program, Australia closed this Saturday morning a very dark chapter in its relations with France.

“The decision to terminate the contract was taken by the former government on the basis of advice on the capability requirements of the Australian Defense Force – advice which was accepted by opposition Labor,” the Prime Minister however recalled. Australian minister.

After canceling the contract for the manufacture of 12 Attack-class submarines in September 2021, Canberra found an arrangement four days ago on what it still owed to the French group. Naval Group and the Commonwealth of Australia have signed an equitable agreement ending the future submarine programaustralian sailorannounced for its part Naval Group in a press release published on the night of Friday to Saturday. The French naval group will therefore cash a nice check for 555 million euros, a large part of the volume of which was governed by contractual clauses. This will also allow it to compensate its French and Australian subcontractors, who will receive a very small part of this sum. The group confirmed to have “also supported its partners and under-French and Australian contractors in their actions”.

“I would like to thank Naval Group for the positive and professional manner in which it has engaged with Australian officials to achieve this settlement,” said the Australian Prime Minister during a press conference.

A bill of 3.7 billion euros

The termination of the contract by the Australians automatically triggered a chapter of the Strategic Partnership Agreement (SPA) signed between France and Australia at the launch of the Attack class program. It follows a number of obligations. This amount of more than 500 million euros is in addition to the 840 million euros already paid to the naval group since the launch of the program for work carried out between 2016 and the end of 2021. In total, Australia has paid 1.340 billion approximately euros to Naval Group. For nothing, for the wind… This is what Anthony Albanese recognized during the press conference this financial arrangement with Naval Group is “an extraordinary waste from a government that has always made a lot of announcements but not in terms of delivery”. The old government “will be remembered as the most wasteful government in Australian history since Federation”.

The outcome of these negotiations, described as “correct and professional”, is really a top exit for Naval Group, which collects this sum of more than 500 million euros, “top of the range” targeted by the group, we explain to La Tribune. The bill is very high for Canberra, which will pay 3.7 billion euros in total for the benefit mainly of the prime contractors of this extraordinary program (in addition to Naval Group, Lockheed Martin and the Australian construction industry which was to build the shipyard hosting the manufacture of submarines).

Return to normal relations between Paris and Canberra

However, the wound is still deep in France even if the fall of the Morrison government was widely welcomed in Paris. Australia’s new Prime Minister Anthony Albanese should soon be welcomed in France to resume normalized relations with Paris.“Now that the issue is resolved, we can move forward in the relationship with Francesaid Anthony Albanese. Australia and France share deep historic bonds of friendship, forged in the common sacrifice of war. We are two dynamic democracies, committed to defending human rights and fundamental values. We deeply respect France’s role and active engagement in the Indo-Pacific.”.

“I look forward to responding to President Macron’s invitation to travel to Paris as soon as possible and to continue to work closely with him as we deepen the strategic partnership between our nations,” said Anthony Albanese.

At the end of May, Emmanuel Macron had already spoken with Anthony Albanese to congratulate him on his election. After taking note of the deep breach of trust between France and Australia, the two men during a telephone conversation agreed “to rebuild a bilateral relationship based on trust and respect to jointly overcome global challenges, first and foremost the climate emergency, and the strategic challenges in the Indo-Pacific”, reported the Elysée in a press release. In this context, a roadmap should identify “strategic cooperation” between the two countries. This will be a real test to solidify the broken relations between the two capitals.