French shipbuilder Naval Group is striking while the iron is hot, with two large successful contracts signed recently. With its strengthened position on the export market, the builder of the Barracuda- and Scorpene-class subs is getting ready to develop sales worldwide. Up its sleeve, a unique strategy of local partnerships and state-backed technology.
 
The recent sales from French Naval Group to Australia and Brazil are good enough news, by themselves. Australia has just endured thirty years of hardships due to the mismanaged program of the Swedish Collins-class and hopes to restore its naval power. Brazil is ramping up its submarine fleet and aims at becoming South America’s leader in territorial water control. The new projects will secure Naval Group’s expertise for the 20 years to come, but the French shipbuilder has no intention of stopping there. With a tightening of ties to Italian shipbuilder Fincantieri planned in the short run, Naval Group will further secure its destiny in surface ships engineering .
 
In both cases, Naval Group has engaged in local partnerships. The contracts are not limited to the warships being built and then delivered: Naval group establishes the development program with a large share of the work occurring within the client’s country (a concept known as work-sharing). Additionally, the contracts include a technology transfer clause, securing the fact that the purchasing country will have entire control of its own fleet. This represents one of the main aspects of Naval Group’s new export strategy. For instance, Naval Group has recently established a Dutch subsidiary, Naval Group Netherlands, to secure a role in the Royal Netherlands Navy’s Walrus-class submarine replacent program, considered as a priority by Dutch Defense Minister Ank Bijleveld.
 
In recent decades, many countries which have purchased submarines found themselves entirely dependent upon the supplier to carry out maintenance and upgrade work of the subs, and the subsequent relationship did not always go well as Australia experienced with Swedish Kockums.
 
But Naval Group’s main asset is its technology. Development costs soared over the latter half of the 20th century, placing private shipyards at risk of launching research programs, and then lacking the funds to finish them. In that perspective, the engineering firm, in need of funds, could be forced to rush development and sell misdesigned or misproduced ships. In the case of Germany’s recent troubles, the frigates which were recently sold had inoperable command centers, weighed far too much, and tilted to starboard. But Naval Group, despite being a private firm, is within the French State’s immediate gravity circle. The win-win relationship for the French state also benefits export clients, as State support guarantees that long and arduous development programs will be carried out, no matter what. Paris, which has the luxury of having one of the most advanced shipyards in the world nearby, keeps its industry on top of the game. Whereas Germany withdrew its support to its national shipyards due to recent mishaps, leading to botched projects. Defense specialist Anne Bauer writes: “Naval Group, the builder of military ships, did the math: in thirty years, the shipyard of Lorient built 29 frigates, including 16 for France and 13 for export. Conclusion: without exporting, the construction site would not have survived. What was true yesterday is even more so today. Britain, which exported its last submarine in 1991, has failed to maintain its skills and remains in the game only thanks to its American allies. Conversely, the German market was not enough for TKMS to win”.
 
The French expect to find the Russians and the Chinese on their way. The United States keeps its technology to itself and forbids exports, and other European shipyards have basically run themselves out of business. However, Naval Group is confident that its strategy will enable it to keep the high end of the market. French technology will give it an edge against the Chinese, who aim for the lower end of the market (Chinese export subs are basically cheap copies of Kilo-class submarines). Defense specialist Mikhail Voytenko writes : “China succeeded in copying the engine and installed China’s homegrown version in its 039B conventional submarines, spending almost 10 years in developing a brand new type of engine entirely with China’s own intellectual property. Just how good this brand-new type is (and how much of it is genuine Chinese intellectual property), is anyone’s guess. It’s what China claims, nothing more than that.” As for Russia, Naval Group feels sure that customers will prefer the local partnership and full-autonomy that it gives them, to suffocating and complicated relationships with Moscow (or Beijing). The Nuclear Threat Initiative writes : “Historically, Russian and earlier Soviet submarine design and construction for export were handled by a large number of shipyards and bureaus, including: the Northern Machine-Building Enterprise and Zvezdochka State Machine-Building enterprises in Severodvinsk; the Amur Shipyard in Komsomolsk-na-Amure; and the Zvezda Shipyard in Primorskiy Krai.”
 
Naval Group has changed its strategy from sub and ship building to sovereignty providing. With the constant development of submarine technology, programs have become scarily complex for purchasing countries, who fear that projects will collapse under the weight of their own intricacies. As submarines became central elements of naval power, countries started regarding them as key points of sovereignty. Naval group embraced that view and built its successful strategy on it. In the wake of the recent contract with Australia, Naval Group CEO Hervé Guillou said : "This country wants to get sovereignty, the full maritime enterprise on their side and that's fine. That's what we've been contracted for. That's what we will deliver."

Australia, in the past 6 years, has diminished its use of cash by a third, purely out of market movement, and not by government regulation. Australia's firm push on national digital infrastructures has simply spread the availability of non-cash payment methods, which more and more Australians have adopted under constraint. So, the next step is killing off cash, now that it wounded – something which now seems less and less unrealistic to some. Richard Holden, from the Financial Review, says “The benefits of a cashless Australia would be significant – and go well beyond not having to stand in line behind someone counting out ten cent coins to pay for coffee (although one shouldn't underestimate how frustrating some of us find that)”.  The main advantage to him would be to end fiscal evasion, as cash tends to go around untapped.  It would also reduce the cost of cash maintenance and help fight crime. In the mainstream of cashless-society supporters, Holden suggests a gradual phase-out “given our payments system, the introduction of the NPP, and mobile phone penetration, Australia is perfectly positioned to carefully but deliberately phase out cash. Starting with $100 and $50 bills and the moving to smaller denominations would be a sensible and practical approach.”
 
Nigeria is on the step above Australia, while shying clear of drastic measures. The Cashless Policy led since 2012 by the Central Bank of Nigeria, has capped withdrawable amounts to about 2000 dollars for individuals and 12 000 dollars for companies, made it mandatory for registered and licensed professional cash transporters to collect proceeds from shops, and fiscally sanction excessive cash transactions. In fact, the Nigerian government is trying to gain control of its own economy, which has eluded its command for decades.
 
However, the problems it faces in the implementation of this policy reveal the inherent risks of any cashless economies. “The financial infrastructure in Nigeria is not adequate to carry the load of a cashless society; ATM’s, Point of Sales system, mobile banking and other mediums have to dramatically expand to touch at least 40 per cent of the whole economy before any meaningful effect can be achieved,” said Ernest Simeon Odior and Fadiya Bamidele Banuso, lecturers at the University of Lagos. Mark Smith, who develops business in Africa for Travelex group, advises “a mixed purse is the best solution and the percentage of cash to card transactions will change with time”, indicating the move will be slow and gradual. If the policy succeeds, Nigeria hopes to stem its most endemic problems : corruption, theft, violence and inability to steer the economy on a national scale.
 
India, however, has gone from push to shove in the war on cash. Wade Shepard wrote for Forbes “On November 8, India’s Prime Minister Narendra Modi announced that 86% of the country’s currency [the most common banknotes, the 500-rupee and the 1000-rupee one] would be rendered null and void in 50 days. It was posited as a move to crackdown on corruption and the country’s booming under-regulated and virtually untaxed grassroots economy, but is also being used as a driver to get millions of Indians onto the country’s official economic grid — many for the first time.”  The news shattered the earth, left many dumbfounded with the unpreparedness and sheer economic violence of the decision, and sent shockwaves through the country. India’s Ministry of Finance, Narendra Modi, said that the purpose was to “curb financing of terrorism and any other subversive activities through the proceeds of fake currency notes. It also aims to restrain the shadow economy in India, the major driver of inflation that adversely affects the poor and deprives the government of its tax revenues. In addition, it is hoped that the move will reduce cash circulation in the country – as most corrupt activities and illegal dealings are done through cash.”
 
However, ordinary citizens were the ones who suffered the most impact, not criminals. Prasad, an author for Indian newspaper Alochonaa explained how “500 and 1,000 rupee notes were the bedrock of the grassroots economy, being the primary drivers of most everyday monetary transactions, such as the payment of wages or in real estate deals.” Diego Maiorano added : “Street vendors and shops are unable to buy provisions, which is causing shortages of basic goods in certain areas. Taxis, rickshaw drivers, barbers, maids and doctors are all facing the difficult choice of either accepting the old notes, or providing their services on credit […] Normal life has been thrown out of gear since the 8th of November.”
 
The war on cash isn't won yet, and it's hard to say whether one battle will come through or not. Some countries have come close, only to back down before citizen's resistance. However, the nature of States tends to suggest that the war will keep on raging until victory is achieved. Governments are self-aggrandizing entities: they only grow, never recede. And given that suppressing cash is ultimately a matter of gaining absolute governmental control of economies, for better and for worse, it seems rather unlikely that States will stop trying, no matter how slim their chances of coming through.