Australia, France Seal A$50 Billion Submarines Deal

Australia today sealed a 50 billion Australian dollars ($37 billion) submarines deal with France, termed the “largest defense procurement program in Australia’s history”.

The inter- governmental agreement (IGA) signed by Australian Prime Minister Malcolm Turnbull and French Defence Minister Jean-Yves Le Drian, is for 12 sophisticated submarines to be built by French defence major DCNS. The Australian headquarters of DCNS that will design and build the Shortfin Barracuda was official opened in Adelaide today.

"The IGA is the last foundation stone needed to ensure Australia is able to develop a cutting-edge sovereign submarine capability," Turnbull told media.

The pact is a "critically important step in the development of our security, in the assurance of our government in delivering Australians the security and the prosperity that they need," he said.

Le Drian, describing the signing as an "historic event", said the agreement was "an important building block in deepening our bilateral relationship, notably... between our two navies".

The new contract between Australia and France lays out the legal framework under which Australia and France will partner on the future submarine programme over the coming decades.

Australia awarded DCNS the main contract in April to design and build its next generation of submarines, conventionally powered version of France’s 4,700-ton nuclear-fueled Barracuda but boast the same stealth capabilities.

The Barracudas are to replace Australia’s aging diesel and electric-powered Collins submarines.