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Australian Government To Pay France’s Naval Group $830 Million Over Scrapped Submarines Contract

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In September 2021, Australia abruptly terminated a huge contract with the French Naval Group, which had been in the works for a decade. The new Prime Minister has just made public a compensation agreement of 555 million euros. Prime Minister. Anthony Albanese said the compensation will allow for a reset in the bilateral relationship between Australia and France.

Australia’s fleet of Collins submarines were going to be replaced by a conventional fleet constructed by Naval Group but that deal was abandoned by the Morrison government, which decided to instead pursue nuclear-powered submarines under the AUKUS partnership.

The decision in September 2021 to scrap the $90 billion contract enraged the French government, resulting in a diplomatic row that included the recall of its ambassadors from Canberra and Washington.

“It follows, as well, discussions that I’ve had with President (Emmanuel) Macron and I thank him for those discussions and the cordial way in which we are re- establishing a better relationship between Australia and France,” Mr Albanese told reporters in Sydney on Saturday.

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