EU chief Ursula von der Leyen and Australian Prime Minister Anthony Albanese struck a long-awaited free trade deal in Canberra on Tuesday, compromising to boost exports in the face of global uncertainty over trade.
A defense and security partnership to boost maritime and cyber security cooperation was also agreed.
“The EU and Australia may be geographically far apart but we couldn’t be closer in terms of how we see the world,” said von der Leyen.
“We are sending a strong signal to the rest of the world that friendship and cooperation is what matters most in times of turbulence,” she added.
“This is a significant moment for our nation as we secure an agreement with the world’s second-largest economy,” Albanese said.
Key sticking points on Australian use of European geographical names and access for Australian beef to Europe were overcome to reach a deal after eight years of negotiations.
A compromise will see Australian winemakers allowed to use the term prosecco domestically, but stop using it for exports after 10 years.
Australia will be allowed to keep using some geographical names, such as feta and gruyere, where producers have used the name for at least five years.
European car makers will benefit from Australia raising the threshold for a luxury car tax on electric vehicles — three-quarters of EVs will now become exempt.
Under the trade deal, the EU said it expected exports to Australia to grow by a third over a decade — with dairy and car makers seeing strong growth of around 50 per cent.
The quota of Australian beef allowed into the EU will increase more than 10 times the current level over the next decade, although that falls short of the level Australian farmers had been seeking.
An increased quota of 30,600 tonnes of Australian beef will include 55 per cent of grass-fed beef entering duty-free, and 45 per cent entering with a reduced duty of 7.5 per cent.
A third of the beef quota will apply for five years, before increasing to the full quota.
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The EU will allow a quota of 25,000 tonnes of Australian grass-fed sheep and goat meat phased over seven years.
The deal is expected to be formally signed after it is approved by the European Council.
EU firms exported to Australia 37 billion euros ($42.9 billion) of goods last year, and 31 billion euros of services in 2024.
AFP
