Across Continents: Reassessing the EU–Australia Trade Agreement

By Mariami Modebadze

Source: Politico

Negotiations toward a free trade agreement (FTA) between Australia and the European Union (EU) were officially authorised on June 18, 2018. The partnership between the two signified an intention to establish a comprehensive and ambitious trade agreement, which aimed to remove barriers to doing business for companies operating between the EU and Australia. At the centre of the FTA was a shared commitment to sustainable development and equal footing, and following 15 rounds of negotiations, 11 chapters and sub-chapters were successfully concluded. However, on October 29, 2023, the EU and Australia decided to suspend the talks.

A Fragile Partnership

Accusations of an ‘unwillingness’ were exchanged by both parties as the primary reason for suspending negotiations, as each nation held different objectives. For the EU, the agreement would have provided greater access to Australia's critical minerals industry, as they aimed to reduce their reliance on Russian and Chinese clean-energy products, including wind turbines and electric car batteries. For Australia, diversifying its trade relations and increasing its integration into the EU-centred supply chain would have reduced its dependence on China, highlighting its commitment to open markets, free trade, and the rules-based global trading system. In addition, both parties shared an interest in promoting investment, skilled labour movement, and trade in services.

The Price of Protection

The suspension of the preferential trade agreement was primarily caused by disputes related to the agricultural sector. Five years of negotiations had already been directed towards benefiting Australia’s agricultural exports and removing EU tariffs. However, Australia’s primary concern during negotiations was the resistance from Brussels to opening up its market to Australian beef and sheep meat, as well as restrictions on feta cheese and prosecco. "We just weren't able to see the EU increase its offer for things like beef, sheep, dairy, sugar, enough for us to think that this deal was in Australia's national interest," stated Australia's Minister for Agriculture. From Australia’s perspective, providing new opportunities for its goods and services is a strategic move to enhance trade relations and give exporters a competitive edge. Businesses generally benefit from a wider variety of goods and services at lower costs. 

Conversely, the EU wants Australia to adopt its so-called “geographical indications” approach, which aims to protect the names of European products. To implement this system, Australia would have to relinquish 170 food names and 236 spirit names, and change its approach to product labels, which currently operates under national consumer protection laws. Concessions over this issue could harm product competitiveness and branding, as well as damage agricultural exports, intellectual property rights, and market access. Without finding common ground on these issues, future trade agreements also risk being stalled, with significant economic consequences for both sides.

Bridging Distance and Navigating Barriers in EU–Australia Trade

Although geographic distance undoubtedly poses certain challenges to fostering closer cooperation, the underlying realities present greater barriers. According to 2024 statistics, Australia ranked as the EU’s 20th largest trading partner, accounting for 1% of the EU’s total trade, while the EU was Australia’s third-largest trade partner. Beyond mere physical separation, the protectionism from both sides over key sectors is reflected in trade imbalances and their differing economic priorities. The EU remains committed to securing access to critical raw materials, which it needs for its green industrial transformation. At the same time, Australia continues to shift its trade focus towards the EU gradually. For both nations, the real task lies in reforming trade partnerships that align with the long-term priorities of both sides.

A Second Chance for Diplomacy

During the G7 Summit in Canada, Prime Minister Anthony Albanese of Australia had the opportunity to renegotiate with the EU. The previously disputed issues were successfully resolved, with the deals including rules related to selling products associated with a specific geographical location, such as feta, prosecco, and parmesan. The negotiation process was supported by German Chancellor Friedrich Merz, who shared the desire to secure an agreement. 

Besides trade negotiations, the Summit has increased the chances of initiating close cooperation on a Security and Defence Partnership (SDP), encompassing areas such as defence, industry, cybersecurity, and counter-terrorism. These broad areas of future collaboration signal renewed efforts from both sides, indicating a recognition that economic and geopolitical shifts demand a fresh approach. The reopening of talks also reflects a willingness to explore mutually beneficial economic pathways, paving the way for a stronger trading relationship and opening new doors for growth and cooperation.

Conclusion

The failure in trade diplomacy in 2023 has led to renewed efforts two years later. The disappointing market access offered for Australia’s beef, sheep, dairy, and sugar exporters led to the initial suspension of the agreement.  The renewed dialogue in 2025, driven by strategic leadership and a recognition of mutual interest, signals a potential turning point. Both sides have expressed a renewed commitment to building durable, non-fragile partnerships, and discussions have reignited amid shifts in global trade and improved access to exports across continents. Accordingly, the dialogue is no longer solely about tariffs, but about securing long-term economic resilience and redefining trusted partnerships.

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Mariami is a graduate with Honours of the triple-institution joint Master’s Degree in Social Sciences. Her professional experience encompasses collaboration with international organisations, including OSCE/ODIHR, the World Bank Group, and the Asian Development Bank, as well as active engagement with youth-focused NGOs across France, Poland, and Georgia. She has held multiple leadership and analytical roles, demonstrating expertise in project management, research, and strategic coordination.  Her research focuses on European affairs, international diplomacy, and geopolitical analysis, driven by a strong commitment to fostering in-depth insights into contemporary global geopolitics.