Amid the crisis, Brussels is seeking to diversify trade ties, bolster its auto industry and secure strategic partners amid rising global tensions, euronews writes.
Agriculture has proved to be one of the most sensitive points in the free trade debate. EU farmers have previously opposed a trade agreement with Mercosur, and a legal challenge from MEPs has jeopardized ratification.
The agreement with Australia will save the EU €1 billion a year in duties, with exports projected to grow by 33% over the next decade. Tariffs will eventually be reduced to zero on products such as cheese (for three years), wine, some fruits and vegetables, chocolate and processed foods.
On the most difficult meat issues, negotiations stalled in 2023 – Australia agreed to quotas of 30,600 and 25,000 tons per year respectively. The safeguard mechanism will allow the EU to ring-fence sensitive sectors if a surge in Australian imports harms the community market.
Rare earth metals
Australia has exceptional geological wealth: lithium, cobalt, manganese, aluminum – all critical resources needed for Europe’s green and digital transition. Australia is the world’s third largest producer of rare earth elements, and the EU wanted to remove trade barriers for critical materials.
For Brussels, the framework agreement on cooperation in critical raw materials is a key lever to reduce dependence on China. “Australia has enormous natural resources and has almost all the minerals we need,” European Trade Commissioner Maroš Šefčovič had earlier pointed out.
