Is Germany Still in the Race for Australia’s Biggest Arms Deal of the Century?

Angela Merkel is aggressively pushing for Germany to win a contract to build 12 submarines.

Tomorrow’s issue of Der Spiegelfeatures a story on Angela Merkel’s efforts to secure one of the largest arms deals in Germany’s history. The article discusses the, according to a German government source, “outstanding” opportunity for the German arms industry should the German manufacturer ThyssenKrupp Marine Systems (TKMS) be awarded the contract to build up to twelve new submarines for the Australian Royal Navy.  TKMS’s offer, the 4,000 tons HDW class 216 is a submarine, specifically designed to meet Canberra’s needs, which is looking to replace its aging Collins-class submarine fleet.

The article further notes that German Chancellor Angela Merkel has already campaigned for the estimated $16 billion weapons deal (other sources cite an indicative price of $20 billion) during the November G-8 meeting in Brisbane, Australia last year, where she met with Australian Prime Minister Tony Abbott. She acknowledged Japan to be Germany’s biggest competitor in winning the contract. Yet, Merkel pointed out that Germany is a neutral arbiter in the Asia-Pacific region, whereas were Australia to choose a Japanese manufacturer, tensions could rise with China. “You are right,” was the terse response of the Australian Prime Minister.

Bloomberg News quotes the defense economics analyst, Mark Thomson, who seems to concur with Angela Merkel’s statement: “Japan hasn’t exported sensitive military technology before and while a deal would mean ties between two close U.S. allies would strengthen, it would be seen in China as a dark cloud.” Yet he also notes that Japan is still the frontrunner in the potential weapons deal. Reuters quotes a former senior Japanese navy commander and his doubts about European manufactures: “I think Japan is the only option for Australia because neither Germany, France nor Sweden has built 4,000-tonne class diesel submarines.”

Full article: Is Germany Still in the Race for Australia’s Biggest Arms Deal of the Century? (IHS Jane’s 360)

One response to “Is Germany Still in the Race for Australia’s Biggest Arms Deal of the Century?