EU suspends trade talks with Australia amid subs row

The latest round of Australia-EU free trade talks have been postponed, a European official confirmed Friday, after Canberra's decision to cancel a major French submarine contract caused fury in Paris.

"The FTA trade round has been postponed for a month until November," an EU official in Canberra told Agence France-Presse.

Australia last month cancelled without notice a multibillion-dollar 12 submarine contract with French defence company Naval Group, opting instead to purchase nuclear-powered vessels for the first time in its history under the new AUKUS defence pact.

The move infuriated French officials and sparked a major diplomatic row with Paris. France has publicly said it can no longer trust the government of Prime Minister Scott Morrison, accusing officials of lying and questioning whether the trade agreement can go ahead.

Australia Trade Minister Dan Tehan was scheduled to travel to Europe for the talks and defended the decision to scrap the French deal as acting in the country’s “national interest”.

The next round of talks was due to cover areas including trade, services, investment and intellectual property rights.