In a stunning reversal of fortunes, Japan — the onetime front-runner in the multibillion-dollar tender to build Australia’s next-generation submarine — failed in its bid to assemble the vessels, Australian Prime Minister Malcolm Turnbull announced Tuesday.

Turnbull said the submarines will be built in Australia by France’s state-controlled naval contractor DCNS.

“Defence Department experts were unequivocal — the French offer best represented the capabilities needed to meet Australia’s unique needs,” Turnbull said at a news conference.

The announcement, which came after media leaks revealed last week that Japan had effectively been eliminated from the bidding process, throws the future of Tokyo’s fledgling weapons-export program in doubt.

But the biggest question remains: How did Japan go from first to worst?

According to experts, a perfect storm of factors helped sink the deal, which would have been Japan’s first large-scale weapons export agreement in decades after the Cabinet of Prime Minister Shinzo Abe approved new rules in April 2014, ending an almost 50-year self-imposed ban on the practice.

While media reports had played up technological risks in buying Japan’s Soryu-class subs to replace its aging Collins-class vessels, experts said Australia’s domestic politics — with an election slated for July — likely played a more deciding factor.

“I think we cannot deny that domestic politics played a role, given the timing of the sub decision,” said Corey Wallace, a security policy analyst at the Graduate School of East Asian Studies at Freie Universitat, Berlin.

For Turnbull, who touted a mantra of “Australian jobs and Australian steel” during Tuesday’s news conference in the South Australian shipbuilding hub of Adelaide, the rapidly changing political environment was key, “given the difficulties the current administration might have in the state during the election,” Wallace said.

With the French pick, he secured firm promises that work on the subs would be done domestically with domestic materials — all ahead of the key poll.

Turnbull is “now concerned about the elections,” said Teruhiko Fukushima, a professor at the National Defense Academy in Yokosuka, Kanagawa Prefecture, and an expert on Australia. “He wanted to directly tell people in Adelaide that he will bring many jobs there.”

Fukushima also said that the selection of the French sub will not greatly affect Canberra’s defense cooperation with Japan and the United States.

The U.S., which has slashed its military budget, has been pushing for Japan and Australia to take on more of the operational burden in the Asia-Pacific region. This is considered a key reason that Washington had reportedly offered tacit support for Japan’s bid to produce submarines.

Fukushima pointed out that Australia’s policy to promote trilateral defense cooperation has already been clearly written into its policy papers — a stance the French selection is unlikely to affect.

“Japan shouldn’t think that it was betrayed by Australia,” Fukushima said. “The trilateral cooperation framework won’t be changed.”

Indeed, despite Japan’s defeat, Turnbull vowed Tuesday to continue to strengthen ties with Japan and the U.S.

“Both Prime Minister Abe and I . . . are thoroughly committed to the special strategic partnership between Australia and Japan, which gets stronger all the time,” Turnbull said. “We are committed, too, to our strong trilateral strategic engagement between Japan, Australia and the United States.”

Although China and its bellicose moves in the South China Sea had featured prominently in media coverage of the bid, analysts said the role of Beijing, which bristled at the idea of bolstered trilateral cooperation, remained unclear.

Technological concerns, meanwhile, were unlikely to have played an outsized role in the decision, retired Maritime Self-Defense Force Vice Adm. Masao Kobayashi said.

Kobayashi, who commanded Japan’s submarine fleet from 2007 to 2009, believed there were no major technological issues with the Soryu, which is often touted as one of the world’s quietest and most advanced non-nuclear submarines.

But both Japanese bureaucrats and defense companies were “slow” in promoting the Soryu and were not as enthusiastic as their French and German rivals, Kobayashi said.

“Japan is a ‘novice’ in the arms-export business,” he said. “They don’t have much experience.”

Kobayashi also pointed out that the two Japanese firms producing submarines for the MSDF, Mitsubishi Heavy Industries Ltd. and Kawasaki Heavy Industries, currently have resources appropriate only for the domestic production of submarines.

That may have been another reason Japan’s defense industry was not desperate to sell the Soryu overseas, he added.

Japan’s Defense Ministry, as well as the MSDF, was also less than enthusiastic about the transfer of sensitive submarine technology — the crown jewels of Japan’s naval force — even to a U.S. ally, said Tetsuo Kotani, a senior fellow at the Japan Institute of International Affairs in Tokyo.

The sub foray “was led by the political leadership,” Kotani said, in reference to Abe.

While Abe had strongly pushed for the submarine deal, there was still a clear sense that the Japanese camp’s lack of experience could prove a liability for Australia.

“The Japanese government had attempted to assure Australia that it would fit in with its program and needs, but such assurances lacked the detail that its more experienced competitors provided,” said Wallace.

“The political enthusiasm expressed by the Abe government could not make up for — or perhaps compounded — the sense that Japan would be feeling through the manufacturing process as it went along,” he said. “The French bid, on the other hand, was clear on the process and promised the most jobs.”

Concerns about an alleged “secret deal” for the subs between Abe and former Australian Prime Minister Tony Abbott had also apparently been festering since at least last September, when Abbott was ousted from the leadership post.

Australian media had reported that Abbott and Abe, who had close personal ties, privately agreed in 2014 that Japan would get the contract. Both sides denied the existence of such a secret deal.

In response to criticism, Abbott hastily put together the so-called Competitive Evaluation Process to lend the tender more transparency, but soon after was ousted in a party coup, said Sam Roggeveen, a security expert at the Lowy Institute for International Policy in Sydney.

“And so the favoritism that Mr. Abbott had shown toward the Japanese bid dissolved along with his demise as leader,” Roggeveen said.

“This meant the Japanese bid had to win on its technological and capability merits, and that the strategic considerations — which were at the core of Mr. Abbott’s thinking and also at the core of the Japanese case for winning the contract — became less important under the new prime minister.”

Had Tokyo been selected, the 56 billion Australian dollar ($43 billion) contract would have been a huge boon for Japan as it pushes for joint defense development with other countries under the new guidelines for the transfer of defense equipment and technology.

But ultimately, the lost bid may prove to be a blessing in disguise for Japan.

“Manufacturing subs off the shelf would have been an interesting opportunity for Japan,” Wallace said. “But as the project evolved to co-manufacturing with an Australian company with a less than stellar implementation history, it may have avoided a potentially not very profitable bullet in losing out on this project.

“It also gets to keep peace of mind in terms of continuing to protect sensitive technologies,” he added.

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