Australian Prime Minister Anthony Albanese has reached a settlement with France’s Naval Group over the early termination of a contract to supply 12 Barracuda submarines. International news agencies reported this on Saturday after an Albanian press conference. The Australian government will pay the French company a “fair and just” lump sum payment of 550 million euros.
In April 2016, Australia entered into an agreement with the French company DCNS (now Naval Group) for the supply of submarines worth a total of 34 billion euros. Due to rising costs and currency fluctuations, the contract rose significantly in price to 56 billion euros. Also the delivery was delayed. With the creation of the anti-Chinese alliance Aukus in September, an alliance with the United States and the United Kingdom, Australia dissolved the French submarine agreement.
The French ambassador to Australia called the move “a knife in the back” and left his post in Canberra. Paris also withdrew its ambassador from Washington and made it clear that Australia would have to pay a ransom. The settlement reached on Saturday should improve relations between the two countries. “Given the gravity of the challenges we face both in the region and globally, it is essential that Australia and France reunite,” Albanian said.
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