France recalls ambassadors from the US and Australia over submarine deal rift

French President Emmanuel Macron (L) speaks with Foreign Affairs Minister Jean-Yves Le Drian on the doorsteps of the Elysee presidential palace after a guest's departure on June 17, 2019 in Paris.
French President Emmanuel Macron and French Foreign Affairs Minister Jean-Yves Le Drian (right). LUDOVIC MARIN/AFP via Getty Images
  • France is removing both of its ambassadors from the United States and Australia.
  • Jean-Yves Le Drian, the French foreign minister, cited their lost $US66 ($AU91) billion nuclear submarine deal.
  • “This exceptional decision is justified by the exceptional gravity” of the deal, Le Drian said.
  • See more stories on Insider’s business page.

France took the extraordinary measure of recalling both of its ambassadors from the United States and Australia on Friday, escalating their feud with the English-speaking powers over a multi-billion dollar nuclear submarine deal.

The announcement came late on Friday from French Foreign Minister Jean-Yves Le Drian.

“This exceptional decision is justified by the exceptional gravity of the announcements made on September 15 by Australia and the United States,” Le Drian said in French, according to BFMTV.

Le Drian also released an English version of his statement.

France’s move is a dramatic escalation from their initial response, which resulted in a gala commemorating 240 years of Franco-American relations being cancelled by the French hosts.

A new security partnership between the US, UK, and Australia aimed at better confronting challenges in the Indo-Pacific has riled France by upending a lucrative defense deal thought to be worth as much as $US66 ($AU91) billion to French shipbuilders.

Australia selected a French builder in 2016 to deliver a fleet of 12 diesel-powered submarines. There were setbacks in negotiations, but a production contract was signed in 2019. The deal was reconfirmed just weeks ago, but now the deal has been scrapped.

Through the new trilateral agreement with the US and the UK, Australia will pursue nuclear-powered submarines, which are significantly more capable than conventional vessels, particularly because they tend to be quieter, have greater range, and are not required to surface as frequently. The US deal to share submarine technology with Australia led the latter to back out of previously negotiated deal with France.

France appears to have been caught off guard by these developments. French officials have expressed irritation with not only the loss of the deal and a perceived betrayal but also the lack of advance notice they were given about the deal, according to The New York Times.