Trade talks between the European Union and Australia have been postponed amid escalating tensions over Canberra’s decision to cancel a $40 billion submarine deal with France.
Australia last month cancelled a deal with the French Navy to build conventional submarines in favor of nuclear-powered submarines under a trilateral partnership with the U.S. and Britain.
France recalled its ambassadors to Australia and the U.S. in an infuriated response to the cancellation, but EU officials said that the trade talks were bound to be postponed without the submarine deal fallout.
“The EU is not in the business of punishing anybody,” said EU commission chief spokesman Eric Mamer, adding that the decision was made by the EU’s executive arm.
EU officials explained that the delay was merely for the parties to prepare for the 12th round of trade discussions which Australian trade minister Dan Tehan confirmed is now set for November, although the latter did not comment on the submarine deal.
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