'French subs, UK trade deal on PM’s European fix-it list' by Phillip Coorey and Andrew Tillett, The Australian
The growing threat posed by China, attempts to salvage a free trade agreement with Britain and the troubled submarine contract with the French will dominate Scott Morrison’s agenda when he heads to Europe late next week.
In his third and most substantial trip abroad since the pandemic struck, Mr Morrison has been invited to attend the Group of Seven leaders’ summit in Cornwall hosted by British Prime Minister Boris Johnson.
Salvaging the FTA with Britain and the French submarine contract are on Scott Morison’s European agenda next week. Alex Ellinghausen
En route he will visit key regional ally Singapore and, on the way home, France, upon the invitation of President Emmanuel Macron.
While France’s increasing interest in stepping up its presence in the Indo-Pacific region will feature in the Paris talks, so, too, are there expected to be frank discussions about the $90 billion submarine contract with French company Naval. The contract has been blighted by strains over such issues as costs and the involvement of Australian industry.
Mr Morrison will reiterate Australia’s expectations, not just of Naval but the French government in fulfilling the terms of the agreement.
Defence Department secretary Greg Moriarty confirmed on Wednesday that the government was examining a fallback to the French deal under what he described as “prudent contingency planning”.
“We are very committed to delivering the Attack (class submarine) but it is appropriate that we would be looking at alternatives if we are unable to proceed,” Mr Moriarty told Senate estimates.
“I’ve certainly thought more about this issue over the last 12 months.
“It became clear to me that we were having challenges with the Attack class program over the last 15, 12 months, so of course you do reasonably prudent thinking about what one of those options might be or what you might be able to do if you are unable to proceed.”
In a likely meeting with Mr Johnson in London, Mr Morrison will also seek to salvage a planned free trade agreement with Britain. Talks are currently bogged down because of disagreements over agriculture and it is no longer certain the two leaders will sign off on the final deal when they meet as anticipated.
While still hopeful of a deal, Australia is prepared to walk away rather than sign what would it believes to be a flawed agreement.
Australia has already reminded Britain that it would have to agree to a meaningful trade deal if it wanted to secure entry to the regional free trade pact, Trans-Pacific Partnership, which it is seeking.
British farmers fear an influx of tariff-free Australian beef and lamb will damage them.
Australia’s High Commissioner George Brandis sent a letter two weeks ago to all British Tory MPs taking aim at the “wild claims” of the British National Farmers Union.
He said if the FTA collapsed because of a dispute over agriculture, Britain’s post-Brexit message of being open for business would be undermined. He hinted it could also damage Britain’s chances of joining the TPP.
China in focus
China is expected to dominate the G7 meeting with Australia, India and South Korea being the invitees. Indian Prime Minister Narendra Modi will not attend because of the COVID-19 crisis in his country.
While in the UK, Mr Morrison is expected to have his first face-to-face meeting with United States President Joe Biden and his second such meeting with Japan’s Yoshihide Suga.
The Australia government now considers the G7-plus meeting to be as important as ASEAN and the Quadrilateral Security Dialogue as a forum to send a united message over China.
Australia’s presence at the forum demonstrates to China that Australia is not isolated, cannot be marginalised and has significant agency with like-minded nations.
It believes these to be stabilising influences in the Indo-Pacific region, not threatening influences.
The government considers such demonstrations to be just as important as building up defence forces.
As Mr Morrison prepares to head overseas, the domestic bipartisan approach to China is fragmenting. In a speech to miners in Canberra, Labor leader Anthony Albanese accused the government of threatening exports with its inflammatory rhetoric towards China, which, he said, was motivated by domestic political considerations.
This built on similar comments made two weeks ago by opposition foreign affairs spokeswoman Penny Wong.
Defence Minister Peter Dutton accused Labor of undermining a united front on China.
“At a time when our partners are coming together and understand the intelligence and threats within our region, the Leader of the Opposition is seeking to undermine the position,” he told Parliament.
Mr Morrison’s talks with Mr Biden will cover the gamut of issues in the relationship, ranging from the Indo-Pacific region and the reform of such organisations as the World Trade Organisation to climate change.
Mr Biden’s predecessor, Donald Trump, spent years demanding Australia withdraw from the Paris climate agreement and now there is a perception Mr Biden is prevailing on Australia to do more on climate change.
Consequently, Australia does not feel under great pressure from the US and believes the issue alone is insufficient to affect the relationship.
This article was originally published in the Australian Financial Review. Click here to access the original article.