French leader says all new subs will be built in Australia

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CANBERRA, Australia (AP) — A new fleet of French-designed Australian submarines will be built in Australia on time and within budget, the French prime minister said on Monday.

Prime Minister Manuel Valls met his Australian counterpart Malcolm Turnbull on Monday, a week after Australia announced that DCNS, a French state majority-owned company, had been chosen to design 12 diesel-electric submarines.

Australia expects the new fleet will cost at least 56 billion Australian dollars ($43 billion), although contracts have yet to be signed to create a DCNS-Australia partnership to build the world's largest conventionally powered submarines.

Valls dismissed speculation that at least the first 97-meter (318-foot) long Shortfin Barracuda subs would be built in a DCNS shipyard in France before construction shifted to the Australian manufacturing hub of Adelaide.

"The choice of the Australian government was to have the 12 submarines built in Australia and this was the basis of our agreement," Valls told reporters at Parliament House through a translator.

"This contract represents also a lot of work for the DCNS staff both in France and across the world," he said.

Turnbull, who faces an election on July 2, agreed that the "entire submarine fleet" would be built in Adelaide by Australian workers with Australian steel.

"The success of the project will draw upon the expertise and technology and resources of our two great countries," Turnbull said.

Both prime ministers agreed that the project boosted the strategic relationship between their countries to a new level and would bind them in a partnership for more than 50 years through submarine construction and maintenance.

Valls said he was personally overseeing the implementation of DCNS's commitments made in its bid against rival submarine manufacturers from Germany and Japan.

"We will meet our commitments be it on the timeline, on the financial commitments or on the performances of the submarines," Valls said.

ThyssenKrupp Marine Systems Australia chairman John White said last week that while he was disappointed that the German bid had not been selected, his company stood ready to support the French project through its personnel's experience in building submarines in Australia.

Japanese Defense Minister Gen Nakatani said he would seek an explanation from Australia to find out why the Japanese submarine wasn't selected.

The first of the 4,500 metric ton (5,000 U.S. ton) subs is due to be launched in 2027.

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