Australian defence minister asks Japan to help develop new subs

(Adds further comments, details)

By Tim Kelly

TOKYO, Oct 16 (Reuters) – Australia’s defence minister David
Johnston asked Japan on Thursday to help his country develop new
submarines, his first formal request for cooperation that could
lead to an unprecedented deal for Australia to buy
Japanese-built vessels.

Johnston made the request during a meeting in Tokyo with
his Japanese counterpart, Akinori Eto, said a Japanese Ministry
of Defense spokesman who attended the talks.

“Johnston requested cooperation from Japan. Eto said Japan
will consider ways in which we can help,” said the spokesman,
Hirofumi Takeda.

Australia and Japan are leaning towards Australia replacing
by the 2030s its ageing fleet of six Collins-class submarines
with as many as 12 stealth submarines based on the 4,000-tonnes
Soryu-class vessels built by Mitsubishi Heavy Industries (Other OTC: MHVYFnews)
and Kawasaki Heavy Industries (Other OTC: KWHIFnews) , sources with
knowledge of the talks told Reuters in August. [ID;nL3N0R24D6]

Such an agreement would require Australia’s prime minister
Tony Abbot to backtrack on a promise to build new boats at home

amidst strong local opposition to a foreign construction
deal.

For Japan such a deal with Australia could rile an
increasingly assertive China and would be its first
fully-engineered military export since at least the end of World
War II. As part of a wider strategy to forge a more robust
military capability to counter China, Prime Minister Shinzo Abe
in April ended a decades-old ban on overseas arms sales because
it will lower arms costs by widening the Japanese defence
industry’s production base.

BACKLASH

In Australia the political backlash to any deal to buy
submarines from Japan is already gathering pace. Opponents, such
as Labor Party Leader Bill Shortern, say such a deal would hit
employment at home, particularly in South Australia, which is
home to some 27,000 defence-related jobs including 3,000 in
shipbuilding.

Abbott so far appears to be weathering the political storm
insisting his government will pick the vessel that best fits the
needs of the navy.

“Decisions about future submarines have to be made on the
basis of what is best for our armed forces, not what is best for
a particular region or what might be best for a particular
company,” Abbot told reporters on Thursday during a visit to a
school in Melbourne.

His government says it is mulling several options for the
new submarine programme, including building the vessels at home
or overseas. Construction in Australia, which has never designed
or built a conventional submarine as large as the Soryu, is a
potentially riskier and more prone to possible delays and budget
overruns.

The research institute Rand last year estimated in a report
commissioned by the Australian government that the design phase
would require 1,000 draftsmen and engineers, five times more
than are currently available in the country.

In a bid to counter the Japanese proposals a delegation from
German submarine maker ThyssenKrupp Marine Systems
this week travelled to Canberra with a proposal to build the
boats in Australia, local media reported.

U.S. BACKING FOR JAPAN

However, backing from the United States, which has close but
separate security pacts with Japan and Australia, may make a
deal to buy Japanese submarines more attractive.

Admiral Stuart Munsch, the chief U.S. undersea naval officer
in Asia, told Reuters in August that U.S. Navy would be pleased
to see Australia operate Japanese-built submarines. His boats
may have to rely on help from Australian and Japanese vessels to
monitor increased undersea activity by China.

Over the next 15 years the U.S. global submarine fleet could
shrink to as few as 41 vessels from around 50 now according to
an estimate from the conservative think tank, the Heritage
Foundation. At the same time China’s fleet may expand by a
quarter to around 80 boats.

Meanwhile Japan, which currently has 16 submarines, is at
the start of a building programme that will increase its
undersea fleet to 22 vessels over the next decade or so.

(Additional reporting by Lincoln Feast in Sydney; Editing by
Pravin Char, Greg Mahlich)

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Australian defence minister asks Japan to help develop new subs
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