The European Union and Australia on Tuesday finalized a landmark free trade agreement in Canberra, ending eight years of negotiations and opening new opportunities for exporters amid growing global trade uncertainty. The leaders also agreed on a defense and security partnership to strengthen maritime and cyber cooperation.
EU Commission President Ursula von der Leyen said, “The EU and Australia may be geographically far apart, but we couldn’t be closer in terms of how we see the world. We are sending a strong signal that friendship and cooperation matter most in times of turbulence.”
Australian Prime Minister Anthony Albanese described the deal as “a significant moment for our nation as we secure an agreement with the world’s second-largest economy.”
The agreement resolves key disputes over Australian use of European geographical names and beef exports. Under the compromise, Australian winemakers can continue using the term prosecco domestically but must cease exports under the name within 10 years. Some other geographical names, including feta and gruyere, can be used if Australian producers have done so for at least five years.
European automakers stand to benefit as Australia raises the luxury car tax threshold for electric vehicles, exempting about three-quarters of EVs.
The EU projects that exports to Australia could grow by a third over the next decade, with dairy and automotive sectors expected to see growth of around 50 per cent. Australian beef quotas into the EU will rise more than tenfold, with 55 per cent of grass-fed beef entering duty-free and 45 per cent at a reduced 7.5 per cent tariff. Initially, one-third of the quota will apply for five years before reaching full capacity. A separate quota of 25,000 tonnes of Australian grass-fed sheep and goat meat will be phased in over seven years.
The deal awaits formal signing after approval by the European Council. Last year, EU firms exported €37 billion ($42.9 billion) in goods and €31 billion in services to Australia.
