The United States’ push to cement itself as the dominant military power in the Indo-Pacific region, and the globe, saw it sabotage the French submarines deal with Australia, and establish the AUKUS military pact. It also sank the prospects for a Paris–Canberra–Delhi alliance that wanted a new Indo-Pacific geostrategic order developing harmonious relations with China.
These machinations are explained in this edited extract below from the new book, ‘Nuked: The Submarine Fiasco that Sank Australia’s Sovereignty’, by Andrew Fowler, published in July by Melbourne University Press.
As Prime Minister Malcom Turnbull and the new French president Emmanuel Macron discussed world affairs under the ornate chandeliers of the Élysée Palace in July 2017, they both understood the political and strategic significance of the submarine deal.
It just might shift the view of the other countries of the 27-member European Union that Australia would always have a closer relationship, both commercially and politically, with the United States than with Europe. Turnbull understood how important it was to prove to the French that they could have a strong ally in the South Pacific.
The following day, he headed off to Cherbourg to put the public seal on a project that had done so much to invigorate the relationship between the two countries. Cherbourg is home to Naval Group, one of the most successful submarine manufacturers in the world, with an order book bulging to €15 billion in 2019.
The Australian contract was just the latest in a series of wins for the company, but at the same time it produced a novel challenge for Naval Group. The French were going to take their Barracuda-class nuclear-powered submarine, remove the reactor that powered it, and insert a diesel-electric engine.
France had won the contract by a country mile, easily defeating the German ThyssenKrupp submarine; the Japanese with their Soryu-class were a distant third. The Japanese boats had been so woeful that when Australian engineers gave them the once-over, they were surprised to find out how limited they were in both range and capability.
On that summer’s afternoon in Cherbourg on the north coast of France, there was nothing to disturb the formal opening of Naval Group’s project office at the huge industrial site. Yet if Turnbull had had the time, he might have read the news from back home in Australia.
Thirteen days earlier Tony Abbott had been on Sydney radio station 2GB casting doubt on the entire project. He said that given the submarine acquisition process was long and involved, it was important that Australia had a ‘Plan B’. There was worse to come. The following day Abbott called for Australia to change course and consider buying submarines powered by nuclear reactors.
Prime Minister Turnbull had deliberately written into the French contract that Australia could switch back to nuclear submarines after two, three or four non-nuclear subs, without a penalty.
If Abbott’s comments had rankled Turnbull, this apparently didn’t show. Turnbull knew the non-nuclear subs could always be reverted to nuclear submarines if necessary. He’d deliberately written into the contract that Australia could switch after two, three or four non-nuclear subs, without a penalty. With a 500-strong highly educated and flexible workforce, the changes would not be that hard to achieve. There was another advantage: France was the only country in the world that made both nuclear and non-nuclear submarines.
For the French, the Australian deal should have been business as usual. Though the size of the undertaking and the complexity of changing a nuclear submarine to diesel-electric would always be challenging, in the end it was simply a matter of planning and process.
The program began moving ahead, guaranteeing that the first Australian-built French submarine would be launched from the Adelaide slipway in early 2030. Though that event was more than a decade away, President Macron was in a hurry to push France in capitalising on the Naval Group win and reinforcing France’s place in Asia and the Indo-Pacific.
Only one French president, François Hollande, had visited Australia before, and only then because he was on his way to a G20 meeting in Asia. What diplomats in both countries wanted was what’s known as a ‘standalone visit’ by Emmanuel Macron: a French president travelling to Australia with the single purpose of recognising the importance of Australia’s relationship with France.
The submarine deal was at the core of a new strategic partnership between Australia and France and, according to one French diplomat, ‘changed the view we had in France of Australia’. It shifted from that of a country not necessarily considered as a ‘priority connecting with us’, to a really essential partner. It was, he said, ‘a sea change’.
President Macron was persuaded that it was in the best interests of France for him to travel to Australia, not just because France had signed on to the biggest single defence project in its history, but because the Indo-Pacific was developing into a hugely important economic powerhouse and a potential flashpoint in the great rivalry between the United States and China. France had a large territorial stake in the region, and the more friends it had there, the better.
Macron would have been encouraged that the Australian Government provided the deck of the helicopter and troop carrier HMAS Canberra for him to deliver his speech when he arrived. The Canberra was the first ship the RAN acquired that was capable of landing troops on foreign shores in large numbers—a signal that Australia was ready to project its force into the Pacific and beyond, where France had so many of its citizens.
Macron, who arrived in Sydney on 1 May 2018, could not have asked for a more appropriate location. The Canberra was at anchor in Sydney Harbour, off Garden Island, the east-coast base of the RAN, where Thales, a major arms manufacturer part-owned by the French state, provides munitions and command, communications and control systems. Macron must have felt he was on home turf.
President Macron talked of the Indo-Pacific axis as a geostrategic new order — ‘the Paris–Canberra–Delhi axis’ — signalling a more independent group in the Indo-Pacific.
Flanked by Turnbull, he laid out a vision of creating an independent grouping of countries in the Indo-Pacific involving France, Australia and India. Significantly, Washington wasn’t given a high profile, though Macron did mention later that the Americans were invaluable allies. He talked of the Indo-Pacific axis not as a slogan or motto but a geostrategic new order— ‘the Paris–Canberra–Delhi axis’ —signalling a more independent group in the Indo-Pacific.
For France, the reach was beyond diplomatic. Paris was also competing with the United States for armaments sales. The French military aircraft manufacturer Dassault had just landed a large order with India to match the Naval Group submarine deal, and India had also placed an order for submarines with the French group.
The emergence of this more independent thinking involving Australia, which until then had been a large purchaser of US military hardware, caused consternation in Washington, where then-president Donald Trump was busy launching a trade war against Beijing, accusing it of stealing American jobs.
Macron’s vision was a direct affront to American power in the Indo-Pacific. He told the politicians and military leadership who had gathered to hear him speak that France shared the strategic view of the Turnbull government about how to cope with the expanded power of China in the region.
He spoke of what he called China’s commitment to ‘become a global power’, but warned that existing rules had to be preserved (notably, Macron did not use the US cliché ‘rules-based order’, meaning the international system of the United Nations, the World Bank and the International Monetary Fund and their rules and ways of operating) and that multilateralism—not control dictated by any one nation—was a precondition of Chinese development in the region. China was fully aware of the difference between supremacy, stability and hegemony, he said.
Macron also confronted the China ‘hawks’ who oppose Beijing’s famed Belt and Road Initiative, a new ‘Silk Road’, building industrial and commercial links between Beijing, Europe, Africa and Asia. He gave veiled encouragement to Australia to be brave in the face of opposition from the United States.
For Macron, the question was not ‘to oppose this initiative, but, much more significatively, to build a dialogue with our allies’. In other words, France was not going to slavishly follow the United States in suppressing the rise of China as an economic power. This was not the kind of view that went down well in Washington, where China was to be not only contained but prevented from becoming a global power.
France was not going to slavishly follow the United States in suppressing the rise of China as an economic power. This was not the kind of view that went down well in Washington.
Finally, Macron directly addressed Turnbull, reminding him of the importance of ‘sovereignty’—a term Turnbull had used in Paris the previous year. If, as was the case, it was important to France, it would become increasingly important to Australia in the future.
The team at the Australian embassy considered Macron’s visit to be a big personal win. Macron even picked up the language the Australians had been advocating to the Élysée that Australia was now focused on the ‘Indo-Pacific’. That description had been used in Australia as a way of not having to choose between talking about either the Pacific or the Indian ocean when discussing foreign policy. They were now a single entity in the Australian Government’s view. With France’s territorial interests spanning both oceans, it was further evidence that Australia and France had a common strategic outlook.
So enamoured was Macron with France’s new relationship with Australia that he broke with his normal protocol and wrote the speech he delivered in Sydney himself. His personal investment in the role France would play in this geopolitical realignment helps explain why he felt so betrayed when it all fell apart three years later.
But that was still to come, and at the embassy in Paris in May 2018 the team were celebrating what they saw as a magnificent diplomatic win. France, which had previously viewed its foreign relations with Australia through a civilisational lens—meaning it saw Canberra as a colonial offshoot of a once great rival power, the United Kingdom—had been persuaded to change its mind. Suddenly Australia had been elevated in French thinking to a critical partner.
Australia now had a significant counterweight to the United States in its foreign relations and defence strategy: the French connection.
Australia now had a significant counterweight to the United States in its foreign relations and defence strategy. Though France and the United States are members of the Group of Seven industrialised nations (G7) and permanent members of the UN Security Council, they do not always vote the same way on major issues of global importance. Australia would now be less beholden to the United States. The French connection would provide Canberra with a greater degree of sovereign choice in both defence and foreign policy.
The right of the Liberal Party reacted furiously. Under attack, Malcolm Turnbull appointed right-winger Peter Dutton to head up a new Home Affairs Department—a super-ministry controlling immigration, border protection and domestic security agencies, including the Australian Security Intelligence Organisation (ASIO) and the Federal Police. But giving the right more power only emboldened them—and their supporters.
Amid a number of leaks from the security services, the media reported in feverish detail that China was spying on Australian industries and targeting politicians. The Turnbull government reacted by passing a ‘foreign interference law’ aimed squarely at China, and banned the Chinese telecommunications company Huawei from operating in Australia.
Amid a number of leaks from the security services, the media reported in feverish detail that China was spying on Australian industries and targeting politicians.
The Trump administration was also whipping up a frenzy against China. Andrew Shearer, a vehemently pro-American China hawk and former national security adviser to Howard and Abbott, had moved out when Abbott lost the prime minister job. He was now back with the Center for Strategic and International Studies (CSIS), a highly partisan right-wing think tank in Washington fixated on confronting China and warning a war was inevitable.
Shearer co-authored an article that mirrored the Americans’ anxieties and called for a ‘rotational presence’ of US warships at the HMAS Stirling naval base in Western Australia, and the possibility of ‘investing in the nuclear support infrastructure necessary for basing of attack submarines’.
It was the first sign of what was to come, but Turnbull probably felt he had no choice: within weeks he brought Shearer back into the government as deputy director-general of the Office of National Intelligence.
A few weeks later Turnbull toughened up his defence credentials again by ordering the military to ‘formally consider the potential for nuclear-powered submarines in Australia’. Technologies were changing, he said, and the risk environment was worsening.
It seemed the French had got lucky: they are the only country in the world to make both nuclear and non-nuclear boats. It was time to examine the possibility of taking up France’s offer and leaving the reactor in the boat.
Though the French were at pains to point out that the Australian version, known as the Shortfin Barracuda, was a new design, there was no doubt its pedigree was nuclear. It was based on a new nuclear-powered Barracuda-class submarine that included features such as improved communication capabilities and increased accuracy of the cruise missiles it carried.
One month before Turnbull announced the French win, the Naval Group chief executive, Hervé Guillou, speaking in Cherbourg, alluded to what might lie ahead. He said France was offering Australia twelve non-nuclear submarines with the capability for Australia to create its own submarine, ‘whether nuclear or conventionally powered’, in the future.
Turnbull says he deliberately left that option available to the Australian Government if the domestic opposition to nuclear power faded, or if it was felt that nuclear submarines were important for a changed security environment for Australia. Naval Group agreed, breaking the contract into sections that allowed the government to end the non-nuclear build at any time and then restart it as a nuclear option without any penalty or extra payment.
There was an ‘unsolicited proposal’ from the French. Australia could have eight nuclear-powered submarines for only 10 per cent more than the cost of the twelve non-nuclear ones.
Kim Gillis, an Australian defence businessman who had been drafted in by Naval Group to help with the submarine negotiations, said there was what he called an ‘unsolicited proposal’ from the French to the Australian Government to deliver nuclear-powered submarines. Australia could have eight submarines for only 10 per cent more than the cost of the twelve non-nuclear ones.
In August 2018, when Dutton unsuccessfully challenged Turnbull for the leadership, he opened the door for the ‘compromise candidate’, Scott Morrison, to be elected Liberal Party leader and then to become Australia’s thirtieth prime minister.
Within weeks Morrison moved Shearer from deputy head of the Office of National Intelligence (ONI) to an even more powerful position: Cabinet secretary. The Cabinet secretary controls much of the business of Cabinet and is a close confidant of the prime minister. Washington now had someone they greatly admired at the heart of the Australian Government. As one ex-intelligence officer told me, ‘The regard in which [Shearer] is held in DC is something else.’
From the moment Shearer re-entered government, the tempo of the argument about which submarine to buy shifted from the best for defending Australia to the best for attacking China. In December 2018, the Morrison government announced that the first new submarine would be named HMAS Attack.
The tempo of the argument about which submarine to buy, shifted from the best for defending Australia, to the best for attacking China.
The name change might have been Morrison the marketing executive putting his brand on a huge item of important defence expenditure, a signal that a new macho leader was in charge of the Liberal Party. His government was softening up the Australian public for a change of role for its submarine acquisition—and much more than that.
From the day he was elected leader of the Liberal Party on 24 August 2018, removing Malcolm Turnbull, Scott Morrison began shifting Australia’s military closer to the United States, virtually intertwining the two nations’ armed forces.
One month after being sworn in, Morrison made a more substantial shift towards Washington. Entrenching the US military in the Australian Defence Department at the highest level, he formally sanctioned Stephen E Johnson, a former commander of the US Navy’s Undersea Warfare Center, as a deputy secretary of defence. This powerful and highly influential position gave Johnson access to the fine-grain details of Australia’s security and strategic secrets.
There is no doubt that the US Navy has an incredible understanding of underwater warfare, but its most outstanding expertise is in nuclear weapons systems and nuclear power. It was odd, to say the least, for Australia to turn for advice to a country with no expertise in conventionally powered submarines. The Liberal–National coalition could see no difference between what was best for Australia’s security and what was best for the United States.
The Liberal–National coalition government could see no difference between what was best for Australia’s security, and what was best for the United States.
By March 2020, Morrison had appointed Peter Dutton, a blunt enforcer, as his defence minister—but Dutton’s job was to attack, not defend. Morrison had outsourced to a political headkicker the job of creating a Chinese ‘Red Scare’ and terrifying the population. He would need a compliant media to manufacture the level of consent that was required to carry out his grand plans, and all the help he could get from the right-wing think tanks now scattered across the nation.
In May 2020, Morrison had ordered a feasibility study to examine how Australia could acquire nuclear submarines without having an Australian nuclear industry to support them.
Morrison was secretly laying the groundwork for what the right wing in the Liberal Party had long wanted: the introduction of nuclear power into Australia and a closer relationship with the United States. The question of Australian sovereignty seemed to be of little or no account.
So the huge shift in Australia’s foreign policy alignment was hatched by a Christian fundamentalist former tourism marketing manager with no training in strategic or foreign affairs, but a great gift for secrecy and deception.
What came next:
What followed was months of media manipulation, political manouverings, and secret dealings to plot the dumping of Australia’s French submarine deal, for US-UK nuclear submarines. Along with these nuclear submarines, a broader AUKUS military pact to acquire hi-tech offensive weaponry, and to expand the US bases and military presence in Australia, was announced in October 2021.
All the details of these events, and more, are recorded in Andrew Fowler’s new book ‘Nuked: The Submarine Fiasco that Sank Australia’s Sovereignty‘ published in July by Melbourne University Press.
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