An Englishman, an American and an Australian walk into a meeting. This may sound like the beginning of a joke, but we now have a French man who is pretty angry, and it’s all because of a submarine deal to deter China.

This state of affairs is the fruit of a security agreement known as AUKUS, where Australia, the UK and the US have signed a trilateral defence pact that calls for Australia to buy a nuclear submarine fleet from the US. This deal is a strategic powerplay as the US attempts to counteract Chinese efforts to be the main player in the Indo-Pacific region.
National defence policy is a big deal in Australia, and it's not the first time that submarine deals with other countries (such as Japan) have been scrapped. The decision to turn away from the diesel-powered French subs, to the more advanced US-UK nuclear submarines is a clear sign that, despite being its major trading partner, China is perceived by Australia as a major security threat in the Pacific region. In fact, the AUKUS deal has been well received by several neighbouring countries such as Taiwan, Singapore, Vietnam, the Philippines and Japan. Unsurprisingly, the Chinese have interpreted this move as an attempt to shift the military-power balance in the region.

However, in the immediate term, the biggest outcry did not come from China but from the US’s first historical ally, the French. The rift between the two traditional allies came about following Australia’s decision to scrap the 2016 deal for French diesel-powered submarines, for a $100 billion deal with the US for nuclear-powered submarines, artificial intelligence technology and military training.
Despite France being Europe’s largest military force, it was kept unaware of the AUKUS deal, and only made aware of Australia’s decision a few hours before it was publicly announced. Its foreign minister described it as a “stab in the back”. When Biden was elected as US president, France had good hopes for a chance to place itself as the US’s main European counterpart. Now, the French have not only lost a submarine deal worth millions, but they find themselves alone and kept in the dark by its closest English speaking friends, who found no place for them in this deal. Such a diplomatically controversial move by Australia is not only a sign of the increased Chinese military threat, but also a wake-up call for the military capabilities of non-US countries if they want to be seen as credible defence partners.
In response, President Macron withdrew his ambassadors from Canberra and Washington D.C., and it took several days for the French president to accept a call from his transatlantic counterpart. Going forward, this may also have implications on the entire European Union. Internally, the French were always vocal about their will for the EU to pursue “strategic autonomy” and be less militarily reliant on the US, whose reputation as a trustworthy partner has been wavering ever since former President Trump took office.
The French will also be less willing to turn a blind eye when it comes to trade and general disputes with the US. Whilst European policy cannot be dictated by one country, French influence can delay meetings and push for language change in ambitious potential papers between both parties, especially in view of an upcoming Trade and Technology council in which the two sides are supposed to reach common ground on multiple global challenges.
Sources:
AUKUS alliance: Nuclear-powered subs will arrive much too late to help us in conflict: https://www.theaustralian.com.au/inquirer/aukus-alliance-nuclearpowered-subs-will-arrive-too-late-to-help-us-in-conflict/news-story/8e7e2160542136db9cdadf05362a548d
AUKUS reshapes the strategic landscape of the Indo-Pacific: https://www.economist.com/briefing/2021/09/25/aukus-reshapes-the-strategic-landscape-of-the-indo-pacific
Aukus: How transatlantic allies turned on each other over China’s Indo-Pacific threat: https://www.ft.com/content/06f95e54-732e-4508-bc92-c3752904ba67
AUKUS a 'wake-up call' for Europe to strengthen sovereignty, say EU ministers: https://newseu.cgtn.com/news/2021-09-21/AUKUS-a-wake-up-call-for-Europe-to-strengthen-sovereignty-13JTr3sdpYs/index.html