Time for Paris to Get Real: Secrecy Is Essential in Statecraft
(Bloomberg Opinion) -- France’s wrath at the cancellation of its $65 billion submarine contract is as much about secrecy as abandonment. President Emmanuel Macron shouldn’t be so vexed — subterfuge is an essential part of any action that reshapes economic and strategic relations. There was zero incentive for Australia, the U.S. or U.K. to flag in advance their plan to sideline the French and use American and British technology to develop a nuclear-powered fleet Down Under.
If you are going to upend or severely strain an existing order, be it financial or diplomatic, it’s essential to avoid talking about it openly too early. Preferably, don’t say a word until the last possible moment. Even then, carefully calibrate utterances that so the media and stakeholders are aware but without sufficient time to effectively mobilize against it.
Big change upsets powerful constituencies. The longer negotiations continue and the more people brought into the room, the greater the risk of unraveling. This has been true of shakeups in Asia, and those affecting Asia, for decades. More than one has involved Paris, Washington and Canberra. Covertness was essential. Macron ought to consider that when fuming about being shut out of last week’s maritime deal.
Almost 36 years ago, in late September 1985, the U.S. and four allies — including France — unveiled what became known as the Plaza Accord, after the New York hotel where the hitherto highly classified pact was inked by finance ministers. The brainchild of then U.S. Treasury Secretary James Baker, the agreement sought a decline in the value of the dollar and an appreciation in the Japanese yen and the former West German deutsche mark. Plaza, which had a profound effect on Japan’s economy and initiated the era of high-stakes multilateral currency diplomacy, was clandestine in design. Every meeting of finance ministers and central bankers now bears its imprint. Communiques are often critiqued in the context of Plaza: child of, hint of, shadow of, and so on. (Japan was party to Plaza, though some Japanese politicians and economists have subsequently said they were ill-prepared for its consequences.)
Stealth was fundamental to the arrangement, Peter Baker and Susan Glasser wrote in their biography of Baker, “The Man Who Ran Washington,” published last year. “He set out to secretly craft an agreement with the world’s other leading economic powers to coordinate their currencies. To do so, he had to keep the whole effort hidden from the public lest a leak set off furious market speculation.” Journalists were only told once the meeting was underway on a Sunday, when trading desks were closed.
Cloak and dagger is as vital in military strategy as in financial statecraft. Again, experience in Asia and with one of the players in the submarine saga is instructive. For much of the second half of the 20th century, Australia’s relations with Indonesia were fraught. They began to warm in the early 1990s, in part because Australia wanted to engage in the economic and diplomatic opportunities that the end of the Cold War presented. What was missing was a meaningful strategic link. Paul Keating, prime minister of Australia from 1991 to 1996, wanted to change that, and began negotiating a security agreement in secret with Indonesian leader Suharto years before the pact was signed in 1995.
Keating later told the Australian Broadcasting Corp.’s Kerry O’Brien that covertness was indispensable: “If it has been known it simply would not have happened. Suharto needed time to get around all the forces in Indonesia to bring on a thing like this. We didn’t hear anything for a long time and we thought he’d dropped it altogether.” While the accord was downgraded after both men left office, secrecy was vital to its achievement in the first place. (Keating is an opponent of the submarine deal with the U.S. and U.K. He says Australia is tying itself too closely with Washington in opposition to China.)
Macron should also remember that France’s own initiatives in the Pacific haven’t always been on the level. In 1985, French agents mined the Greenpeace vessel Rainbow Warrior while it was berthed in Auckland, killing one person. The ship was on a voyage to protest French nuclear testing in the South Pacific. Paris initially denied any involvement in the bombing, but New Zealand authorities subsequently caught and convicted officers from the French security services. France acknowledged its role and apologized. Did France give New Zealand a heads up about its intentions to engage in sabotage?
France can complain all it wants about being “stabbed in the back,” but Macron knows that for the U.S., Britain and Australia to pull off their pact, Paris had to be out of the loop. Perhaps it’s time for less John le Carré, and more realpolitik.
This column does not necessarily reflect the opinion of the editorial board or Bloomberg LP and its owners.
Daniel Moss is a Bloomberg Opinion columnist covering Asian economies. Previously he was executive editor of Bloomberg News for global economics, and has led teams in Asia, Europe and North America.
©2021 Bloomberg L.P.