Australia to pay Naval Group compensation for breaking submarine contract

Australian Prime Minister Anthony Albanese said that the Australian government will pay the French shipbuilder Naval Group compensation in the amount of 555 million euros for breaking the contract for the construction of submarines.

The former Australian government, led by Scott Morrison, abandoned the project to supply 12 submarines from France for 56 billion euros. Albanese, the new Australian prime minister, expressed confidence that he could normalize relations with the French leadership, which had faltered after the abandonment of French submarines.

"As part of the settlement, Australia will pay Naval Group 555 million euros, which is equal to approximately 830 million Australian dollars," Albanese said during a speech, the video of which was posted on his social networks.

According to Albanese, this is "a fair and equitable settlement."

In mid-September 2021, Australia struck a defense and security deal with the UK and the US under the new AUKUS partnership and announced it was withdrawing from the submarine agreement with the French company Naval Group. Macron then said that the Australian government "behaved badly," and French Foreign Minister Jean-Yves Le Drian called Australia's decision to break the agreement "a stab in the back."