These are only guesses on my part, but I would propose a combination of the following:
- Long-term fallout from the late-2000s recession has western navies more interested in lower-cost systems
- Experience with waterjets on LCS and some flavors of the MEKO has not been super positive
- Experience with whiz-bang technology in general (e.g., the Zumwalts) has not been positive
- General loss of interest in high speed (with the notable exception of LCS), where AWJ-21 offered the most substantial advantages
- Some fundamental shortfall in the AWJ-21 system itself
I do not propose which of these might be the real crux of the matter, but this list seems likely to include it somewhere. I'd be curious to know more, if anybody has something more concrete.