The European Union (EU) and Australia announced on Tuesday that they were unable to conclude their talks on a proposed free trade agreement due to unresolved differences, particularly regarding agricultural products.
Negotiations between the EU and Australia began in 2018 with the aim of reaching an agreement this week. However, disagreements persisted, particularly concerning the level of market access the EU would grant to Australian agricultural goods, especially beef.
A spokesperson from the European Commission expressed regret over the inability to finalize the talks and stated that more work is needed to address the outstanding issues.
Australian Trade Minister Don Farrell confirmed that negotiations would continue, and officials from both sides would seek to reconvene in August. He emphasized the importance of meaningful agricultural access to European markets for Australia, highlighting the desire for expanded trade in beef, lamb, dairy products, and wines, which currently face tariffs and quotas.
Farrell expressed optimism that, with goodwill, hard work, and perseverance, an agreement could be reached. Both the EU and Australia are seeking to diversify their trade relationships, with the EU aiming to reduce its reliance on China and Australia looking for alternatives to its blocked agricultural exports to China.
Furthermore, a trade deal between the EU and Australia could support the EU’s transition to green and digital technologies by providing access to critical raw materials, reducing dependence on China. Australia, being a major producer of lithium and possessing significant deposits of other critical minerals, stands to benefit as well.
Negotiations are also ongoing regarding enhanced EU access to Australian energy, raw materials, and services.
The EU has estimated that a trade agreement with Australia could contribute up to 3.9 billion euros to the EU’s gross domestic product by 2030, benefiting various sectors such as machinery, metals, electronics, chemicals, automotive, and food and drink industries.
Australia anticipates gains for its agricultural exporters and service providers, along with increased opportunities for Australian businesses to invest in Europe.
