🌍 Is AUKUS dead?
Plus: The Europeans are cancelling what!?
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Today’s briefing: |
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Good morning Intriguer. I spoke to a senior French diplomat in HQ recently, who joked that France had played the part of the jilted lover in the Australia-UK-US (aka AUKUS) submarine deal, in which Australia reneged on its previous agreement to buy French submarines in favour of jointly-developed AUKUS ones.
Jilted lover France may have been, until recently. Those following the AUKUS deal’s development will have heard that there’s now trouble in paradise, with the agreement increasingly facing internal US scrutiny.
All of this has of course sent jitters down the ‘AUK’ part of the alliance, with France no doubt now sitting back and enjoying the show, popcorn in hand. Let’s dive into that saga in our top story for today.
Number of the day
$118,000
That’s the new record Bitcoin just hit (at time of writing), reflecting renewed investor interest ahead of expected Fed rate cuts in Q3.
Hocus-AUKUS
The historic AUKUS (Aus, UK, US) defence tech pact is in the news again, with Aussie outlets flagging the Trump administration might revise the deal, years after the ink dried.
Revealed via a shock 2021 announcement, the trilateral deal pledges varying defence tech cooperation, but the kicker was to help Australia get nuclear-powered (not armed) subs.
Why such a shock? The announcement meant a couple of big things:
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First, the US was sharing its crown jewels (ultra-secretive nuclear propulsion tech) for the first time since looping in the Brits way back in the 1950s, and
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Second, while that earlier move was to empower the Brits to help counter Soviet naval power, this 2020s move empowers the Aussies to help answer a new China.
How? This particular tech gives subs unlimited range and unparalleled stealth. In practice, that means rivals never really know where you are, so have to think twice about any move.
But of course, there were always some big questions around this AUKUS deal:
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Realistic? These big defence projects are rarely on-time or on-budget
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Expensive? We’re talking somewhere from USD200B to $250B or beyond
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Enough? By the time Australia maybe starts getting 3-5 US subs (2030s) and 5-8 AUKUS subs (2040s), China will have 50-90 new subs (several nuclear-armed)
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Too soon? Some argue AUKUS spooks the region and triggers an arms race (though AUKUS fans would note it’s a response to China’s own historic build-up)
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Obsolete? There’s debate whether that tech still has an edge by the 2040s
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Lawful? China and Russia have (unsuccessfully) argued that sharing this propulsion tech breaches non-proliferation rules
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Sovereign? Some argue adopting US-controlled tech binds Australia to the US
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Dependable? Others query if the US will uphold its part, whether in capability (it’s behind schedule on its own subs) or policy (rising scepticism towards alliances).
Anyway, four years into the deal, several of those questions are still bubbling away, which brings us to today’s news: the US quietly launched a 30-day review of AUKUS last month, billed as ensuring it’s all in line with the president’s America First foreign policy.
Those 30 days are now up, and there’s been no public word, but leaks suggest the senior Pentagon bigwig driving the review (Elbridge Colby) wants a couple of tweaks, including:
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More money from the Australians, and
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A pledge to use the subs to back the US in any conflict with China
Colby, who many would describe as a prioritiser (ie, believing the US needs to drastically pivot its resources and focus to counter China), reportedly argues that a) the US is giving away its crown jewels despite not meeting its own sub needs, and b) it’s still not getting enough quid in return for that American quo.
So if those reports are true, we’re talking about several of the above AUKUS fears now coming to life, potentially leaving Canberra (and others watching) some tough decisions.
But right now, we’re just dealing with initial leaks. And the latest word is Washington’s 30-day review might actually take several more months.
Intrigue’s Take
AUKUS was only ever one part of America’s ‘latticework’ of partnerships trying to rebalance against a resurgent China. But ditto, AUKUS was only ever one part of Australia’s efforts to adapt to a rapidly shifting world.
The common thread was always about options: wanting a region where no country dominates, and no country is dominated. And Trump 1.0 sought to resolve the tension around that vision by telling allies that sure, it was America First, but not America alone.
Yet the same week these AUKUS leaks started emerging, it’s been interesting to see how a US ally like Australia is clearly now resolving that same tension itself as it grapples with new US tariffs: big speeches from Australia’s prime minister and foreign minister — featuring (eg) the retelling of a WWII story of pushing back on allies when needed — have been careful to nod at the history of US-Australia partnership. But their central message has really been around the foundational need to still chart one’s own course.
So time will tell whether these AUKUS reports are accurate; and if so, whether Colby has Trump’s backing; and if so, how Australia might respond to any shifting goalposts. Lots of ifs. But still, the whole saga is a vivid illustration of how our new world is trying to balance its need for help with a primal urge to go it alone.
Sound even smarter:
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Under AUKUS, Australia would become the first country allowed to buy a US Virginia-class submarine and the seventh to operate a nuclear-powered sub.
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Australia’s defence minister was just in DC this February confirming a ~US$550M investment in US shipyards for the eventual delivery of Virginia-class subs.
Perks with Intrigue
Meanwhile, elsewhere…
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🇨🇦 CANADA – Howdy neighbour. Comment: By our count, that’s 22 similar letters this week, including to Japan, Korea, Malaysia, South Africa, Indonesia, Philippines, and Brazil. It’s an attempt to up the ante after the 90-deals-in-90-days pledge produced two (the UK and Vietnam). The wrinkle is that all these tariffs could get dropped to zero, pending the outcome of an appeal over whether the president has been unlawfully using emergency powers. Capitals might therefore await that outcome before offering any concessions. |
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🇺🇸 UNITED STATES – Take that back. |
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🇷🇺 RUSSIA – More sanctions? Comment: If signed, it’d be a game-changer, imposing costs on powers like China and India for keeping Putin’s economy above water. But the ‘if’ there is big: word is the US president is insisting any bill give him complete waiver authority. Still, the timing would be rough for Putin — Secretary Rubio just said 100,000 Russian soldiers have *died* since January, and there are flashes of anxiety among Moscow’s elite. |
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🇪🇺 EUROPEAN UNION – We’re going solar. |
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🇲🇾 MALAYSIA – Count us in. Comment: It’s Secretary of State Rubio’s first trip to Asia since taking the job, and the timing is tricky given at least eight of his counterparts (Malaysia, Thailand, Indonesia, Cambodia, Laos, Myanmar, Philippines, and Brunei) are likely still processing the tariff letters their capitals just received from President Trump. |
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🇸🇩 SUDAN – Wise up. |
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🇦🇷 ARGENTINA – Your turn. Comment: To give you a sense of the trouble he’s in, this case emerged after authorities examined his secretary’s phone over his separate domestic violence charges. This constant drip-drip of old Peronist scandals probably helps the new president (Milei) as he keeps pursuing drastic libertarian reforms. |
Extra Intrigue
Three stories we couldn’t shoehorn in this week
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Sports: How Turkey is recruiting foreign sport stars to its Olympic line-up.
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Aid: How Russia is reportedly aiming to fill USAID gaps via the Kremlin’s own aid agency (which has a budget of just $77M).
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Culture: Festival organisers in Slovakia have ditched next weekend’s Rubicon event, which would’ve featured controversial US artist Kanye West.
Soundtrack of the day
You might’ve heard that Poland just handed the rotating six-monthly EU Council presidency to Denmark. The EU project lives on. But you know what doesn’t live on? The EU tradition of each incoming president releasing its own official national Spotify playlist!
The Danes haven’t clarified why they’re ditching this, but if you wanted your Danish fix, check out artists like Kim Larsen, MØ, Lukas Graham, Agnes Obel, and Svaneborg Kardyb.
Friday quiz
This weekend is the start of Naadam, a national festival celebrated every July across Mongolia. So, what better excuse for a Genghis Khan quiz, right?
In which century was Genghis Khan born? |
Which region did Genghis Khan not invade during his lifetime? |
Where did his birth name (Temüjin) come from?(at least, according to legend)
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