Trade talks between Australia and the European Union have been postponed as a row with France over the so-called Aukus security partnership deepens.
Last month, Canberra cancelled a $37bn ($27.5bn) deal with France to build a fleet of conventional submarines.
Instead, it will build at least eight nuclear-powered submarines with US and UK technology.
The decision angered Paris, which called the deal a “stab in the back” by the US and Australia.
In fact, soon after the Aukus agreement was announced, France recalled its ambassadors from both Canberra and Washington.
The ambassador to Washington will now return to his post, but it is not clear if the ambassador to Canberra will do the same.
In solidarity with France, European Commission president Ursula von der Leyen has questioned whether the EU would be able to strike a trade deal with Australia.
Australian Trade Minister Dan Tehan declined to comment on what part, if any, the submarine deal had played in delaying negotiations but confirmed that the next round of talks, which were scheduled to start on 12 October, had been postponed until the following month.
“I will meet with my EU counterpart Valdis Dombrovskis next week to discuss the 12th negotiating round, which will now take place in November rather than October,” he said.
In June, after the last round of talks over a free trade deal, the European Commission said negotiations had “progressed in most areas of the future agreement”.
The next round of talks was expected to include a number of subjects including trade, investment and intellectual property rights.
The EU is Australia’s third-biggest trading partner, with trade in goods and services totalling almost $72bn last year.
Aukus: The basics
- What is Aukus? It’s a security pact between Australia, the US and UK. It allows for greater sharing of intelligence, but crucially it gives Australia secret technology to build nuclear-powered submarines, though not equipped with nuclear weapons
- What’s the aim? Aukus is widely seen as a response to the growing power of China, and an effort to counter its influence in the contested South China Sea
- Why has it angered France? Australia cancelled a $37bn (£27bn) deal with a French company building diesel-powered submarines, and, what’s more, France – a traditional Western ally – found out about the new pact only a few hours before the public announcement
Analysts have described Aukus as probably the most significant security arrangement between the three nations since World War Two.
But France considers the Asia-Pacific region to be of key strategic and economic importance, with 1.65 million French citizens on islands including La Réunion, New Caledonia, Mayotte and French Polynesia.