The Terrible submarine under construction at DCNS's shipyard in Cherbourg

French naval contractor DCNS's massive contract to design and build Australia's next generation of submarines will create "thousands of jobs" in France, Defence Minister Jean-Yves Le Drian declared Tuesday. Australian Prime Minister Malcolm Turnbull promised thousands of jobs at home, too, since the submarines will be built in Adelaide.

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Australia's biggest-ever defence procurement programme - worth 50 billion Australian dollars (34 billion euros) over 50 years - is expected to create 4,000 jobs in France and 2,800 in southern Australia.

"We are married to Australia for 50 years," Le Drian told Europe 1 radio, although most of the work by DCNS and its subcontractors in France will last five years.

DCNS share should be about eight billion euros, sources told Reuters news agency.

Jobs should be created in the Channel port of Cherbourg, in Lorient and Brest in Brittany and in Nantes on the Atlantic coast.

French President François Hollande hailed "a decisive advance in the strategic partnership between the two countries who will cooperate over 50 years".

The 12 4,500-tonne submarines will replace Australia's ageing diesel and electric-powered Collins Class submarines, which are due to leave service from around 2026.

Known as the Shortfin Barracuda, the model is a conventioally powered version France's nuclear-powered 4,700-tonne Barracuda, equipped with pump-jet propulsion that enables it to move more quietly than submarines with propellers, which DCNS dubs "obsolete".

The new vessel would be "the recipient of France's most sensitive and protected submarine technology and will be the most lethal conventional submarine ever contemplated", DCNS said on its website.

The combat system will be provided by the US's Lockheed Martin and Raytheon.

France beats Japan, Germany for subs deal

The French company beat a Japanese government-backed consortium led by Mitsubishi Heavy Industries, which was initially expected to win the contract, and German group ThyssenKrupp Marine Systems.

But, although US officials were reported to be backing Japan, there were doubts about the Japanese ability to build abroad.

Giving Japan the contract would also risked annoying Australia's biggest trading partner, China, Washington's main target in its wish to encourage deeper maritime cooperation with Canberra and Tokyo.

Exclusive negotiations will now start with a view to starting the project at the beginning of 2017.

The choice of provider was due to be announced in June but appears to have been brought forward because early elections are to be held in July.

South Australia, of which Adelaide is the capital, has the highest unemployment rate in Australia (7.7 percent in February).

"This a great day for our navy, a great day for Australia's 21st century economy, a great day for the jobs of the future," said Turnbull, who leads the Liberal Party. "Australian built, Australian jobs, Australian steel, here right where we stand."

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