French submarine dispute could torpedo EU-Australia trade talks

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The French government has been crumbling since Australia abandoned a $90 billion Australian dollar ($65 billion) deal last week. With France in favor of a new military agreement with the United States and the United Kingdom.

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France’s European Affairs Secretary Clement Beaune said: “It is a condition of democracy and trust between allies to speak out.” told Politico. A spokesperson confirmed his remarks on Monday. “So it’s unthinkable to move on to trade talks as if nothing has happened to a country we no longer trust,” Bunin said.

As part of the security agreement, known as AUKUS, Australia will be supplied with technology to build a fleet of nuclear-powered submarines, which are considered superior to conventionally powered ships, Canberra previously Had agreed to buy from Paris. In response to the move, France on Friday recalled its ambassadors to the United States and Australia.

A free trade agreement was negotiated between the European Union and Australia launched in June 2018, and so far 11 rounds of talks have taken place, including areas such as removing barriers to exports and Intellectual Property Rights. The next round is due later this fall.
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While the European Commission has the power to conduct trade talks on behalf of the 27-nation bloc, it is unlikely to proceed with the deal if the French oppose it.

“At the end of the last round with Australia, which took place in June, it was agreed that the next round would take place in October. This is the current state of the game,” said Erik Mammer, chief spokesman for the European Commission. Following the remarks of the French minister. “We are analyzing the impact of the AUKUS announcement on this programme.”

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According to the European Commission, the European Union was Australia’s third largest trading partner in 2020. Trade in goods between the two stood at €36 billion ($42 billion) that year, while trade in services was €26 billion ($30 billion) in 2019.

The deal could add between €1.8 billion and €3.9 billion ($2.1 billion and $4.6 billion). EU GDP By 2030, according to the European Commission.

The threat to the EU trade deal comes at a time when Australia is watching Developing new export markets after relations with China’s largest trading partner recently soured.

Australian coal, wine, barley and beef have all already been hit by trade tensions with China, and experts say Auks has resentment Beijing even further.
Meanwhile, China is exploring a way into Australia’s other big trade deal – Comprehensive and Progressive Trans-Pacific Partnership (CPTPP), which is an 11-country free trade agreement that entered into force in December 2018. China formally applied to join it last week.

—Joseph Atman and Saskia Vandoorne in Paris and James Frater in London contributed to this report.

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Credit : www.cnn.com

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