logo logo

‘Disappointed’: Australia and EU fail to resolve trade deadlock, pledge to resume talks in August

All the versions of this article: [English] [français]

The Sydney Morning Herald | 12 July 2023

‘Disappointed’: Australia and EU fail to resolve trade deadlock, pledge to resume talks in August

By Latika Bourke

Brussels: Trade Minister Don Farrell said Australia will walk away from trade talks with the EU if a deal is not struck by the end of the year after two days of talks in Brussels ended in deadlock.

Australia wants the EU to grant it meaningful access to its agricultural markets and allow producers of foods like prosecco, Parmesan and feta to be able to sell them under those names.

But the European Union, which heavily subsidises its agricultural sectors, is resisting opening up its markets to Australian producers at a level Australia says is commercially meaningful. And it wants to protect the names of foods first produced and named in European countries under its system of Geographical Indicators.

Farrell, who broke his European holiday to dash to Brussels for the two days of talks, said he was still optimistic of making progress next month when the two sides have agreed to reconvene.

“We’re disappointed that we couldn’t finalise a new FTA with the Europeans today but we’ve agreed a process to continue the negotiations and I view that very positively,” he said in an interview.

“We’re narrowing down the number of issues in dispute between us, we’re getting closer on those outstanding issues but we’ve still got a way to go. Time will tell.

“I think there’s a desire on both sides to reach an agreement and the next few weeks will tell whether that’s possible or not.

“I’ve taken the trouble to come here, this is my third visit to Brussels over the last six months, I think we’ve demonstrated our bona fides about wanting to get a fair agreement for Australia and now we’ve got to finalise that process.

“We’ll know this year whether or not we’re capable or not or getting a result and I’m optimistic that we will.”

The EU’s trade spokeswoman Miriam Garcia Ferrer said Australia had wanted more time to consult internally.

“We note there were several issues on which the Australian side required further internal consultations,” Garcia Ferrer said.

“We rely on our Australian partners to work with us to get this over the line soon. Our door remains open.

“The EU side has made every effort to arrive at a balanced agreement that meets our mutual strategic interests, while also protecting the interests of our stakeholders.

“We regret it was not possible to conclude our talks with Australia this week. Our respective teams will continue to work on bridging remaining gaps.

Europe wants access to Australia’s critical minerals with both countries looking to diversify their economies away from dependencies on China.

“We want a diversified trading relationship, we never again want to be reliant on one single market,” Farrell said.

While Australia can still sell critical minerals – required for the green transition and to make technological goods – a trade agreement would lessen foreign investment screening requirements and encourage European investment in the sector.

“We are on the cusp of a golden age in terms of our critical minerals, there’s never been a time, probably since the gold rush, when our products have been so valuable,” Farrell said.

“Do we sell all of our products to the Americans? No, we’d like the Europeans to come in. We want to give them some advantages if they’re prepared to invest in our country.”

However, Europe is reluctant to allow competitors into its agricultural markets. France and Ireland are particularly sensitive.

As a result of Brexit, Ireland will face competition from Australia in the UK, its primary market, which will eventually allow unlimited imports of Australian beef under a post-Brexit trade agreement.

Farrell said Europe could not expect Australia to be satisfied with the sort of deal it struck with New Zealand.

“At the moment, let’s take the beef quota and we only get access to one steak per European consumer every 50 years, that’s an unsustainable position for the Australian meat industry,” he said.

Political leaders to take up the baton

While trade officials continue to work out the details behind closed doors, the case will be taken up at the political level.

Prime Minister Anthony Albanese has already raised the matter with German Chancellor Olaf Scholz in Berlin and with French President Emmanuel Macron during their meeting on the sidelines of the NATO conference underway in Vilnius, Lithuania.

“I also raised, of course, the issue of the Australia-EU Free Trade Agreement and put to him Australia’s case, which is we want a better deal than what’s currently offered on beef, and on sheep meat,” Albanese said after his meeting with Macron.

“And we’ll continue to argue the case for a free trade agreement in the interests of both Australia and Europe, but we won’t just sign up to a deal for the sake of it. What we want is a good deal for Australia and we’ll continue to do that.”

Farrell said Albanese would be meeting EU Commission President von der Leyen on Wednesday afternoon.

 source: The Sydney Morning Herald