Trade Minister Dan Tehan says the federal government “expected” France to be disappointed with the decision to scrap the $90 billion submarine deal.

Australia’s decision to scrap the French submarine deal in favour of a new fleet of nuclear-powered submarines under the AUKUS alliance has been met with harsh criticism by France.

The tension has led to speculation the possibility of a free trade agreement between Australia and the European Union may not go ahead.

“I can understand why they are disappointed,” Mr Tehan told Sky News host Chris Smith.

“But what we have to remember is this was a commercial deal and what we have to do is make sure that we ultimately can protect our national interest.

“And that the EU can continue to pursue their national interest.

“My view is the Australia-EU free trade agreement is very much interests of the European Union, as it is with Australia.”

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