Australia and EU sign comprehensive trade deal amid global tensions
The European Union and Australia struck a long-awaited free trade deal on Tuesday, while also agreeing to boost defence cooperation and access to rare earth minerals, in the face of global uncertainty over trade.
Issued on: 24/03/2026 - RFI
European Commission President Ursula von der Leyen, left, and Australian Prime Minister Anthony Albanese shake hands after signing a joint statement during a ceremony at Parliament House in Canberra, Tuesday, 24 March 2026. © Lukas Coch / APEuropean Commission chief Ursula von der Leyen's visit to Australia comes as the 27-nation bloc and the import-reliant nation navigate renewed energy vulnerability, sparked by the war in the Middle East.
The accord is the latest agreed by Brussels in a push to diversify trade as Europe faces challenges from the United States and China.
Key sticking points on Australian use of European geographical names as well as how much beef can be exported to the continent were overcome to reach the deal, following eight years of negotiations.
Another compromise will see Australian winemakers allowed to use the term "prosecco" domestically, but they must stop using it for exports after 10 years.
Australia will also be allowed to keep using some geographically linked names, such as feta and gruyere, in cases where producers have used the name for at least five years.
And European car makers will benefit from Australia raising the threshold for a luxury car tax on electric vehicles – three-quarters will now be exempt.
The two sides also agreed to step up defence cooperation as well as critical raw materials.
'Harsh' world
Addressing the Australian parliament on Tuesday, von der Leyen described a world that was "brutal, harsh and unforgiving".
In that context, she said the EU and Australia were bound by common values and must work together to mitigate over-reliance on countries such as China for critical minerals.
"We cannot be over dependent on any supplier for such crucial ingredients, and that is precisely why we need each other," she said. "Our security is your security, and with our new security and defence partnership, we have each other's back."
She told lawmakers Tuesday's agreement on trade was a "fair deal, and one that delivers for your businesses and one that delivers for our businesses".
Under the deal, the EU said it expected exports to Australia to grow by a third over a decade.
The quota of Australian beef allowed into the bloc will increase more than 10 times the current level over the next decade, although that falls short of what Australian farmers had been seeking.
Australia's National Farmers' Federation said it was "extremely disappointed" by the outcome of the deal.
"What the Australian government has accepted today appears to offer no material change for key agricultural commodities as what the government rightly rejected in October 2023," president Hamish McIntyre said.
EU firms exported €37 billion of goods to Australia last year, and €31bn of services in 2024.
And Australia said the deal could add AU$7.8bn (€4.6bn) to its gross domestic product by 2030.
Vulnerabilities
Australia's largest export market is China and the US is its largest source of investment.
But Canberra has redoubled efforts to diversify export markets for farmers since a 2020 dispute with Beijing saw agriculture shipments blocked for several years, and last year's global imposition of US tariffs.
Likewise, the EU is on a drive to strike new partnerships in the face of US levies and Chinese export controls.
Von der Leyen's visit was overshadowed by the war in the Middle East, which has sent oil prices soaring.
The EU chief this month said the conflict had served as a "stark reminder" of Europe's vulnerabilities. And on Tuesday she called for an immediate end to hostilities in the face of a "critical" situation for energy supply chains globally.
Australia – which is heavily reliant on fuel from abroad – has also felt the pressure from the global energy squeeze.
(with AFP)
EU-Australia trade deal draws ire of farmers and lawmakers
Copyright AP Photo
The new EU-Australia trade deal has drawn criticism from farmers and MEPs, who argue that it will open the door to additional imports of sensitive products on top of those already agreed under the contentious Mercosur deal, while not providing full protection for certain EU regional products.
Copa-Cogeca, the EU’s influential farmers’ lobby, said in a statement on Tuesday that the EU’s concessions to Canberra in the newly signed trade deal with Australia are “unacceptable” as they fail to sufficiently protect European farmers.
“In a post-Mercosur context, the cumulative impact of successive trade agreements makes these concessions unacceptable,” the lobby said, adding: “European farmers cannot continue to absorb the cost of bilateral trade liberalisation without adequate and truly effective safeguards.”
The EU-Australia agreement sets quotas for sensitive products including beef (30,600 tonnes a year phased in over 10 years), sheep meat (25,000 tonnes a year over seven years), sugar (35,000 tonnes) and rice (8,500 tonnes phased in over five years).
But Copa-Cogeca warned that these figures add to quotas already allocated to Mercosur countries — Brazil, Argentina, Uruguay and Paraguay — including 99,000 tonnes for beef and existing sugar quotas with Brazil and Paraguay.
The Commission included a safeguard mechanism allowing the EU and Australia to impose temporary measures within the first seven years if a sudden increase in imports leads to major market disruption in either partner’s market.
However, the lobby described these measures as mere “communication tools,” with one representative telling Euronews that “they will be slow to activate if a market crisis occurs.”
Copa-Cogeca, the EU’s influential farmers’ lobby, said in a statement on Tuesday that the EU’s concessions to Canberra in the newly signed trade deal with Australia are “unacceptable” as they fail to sufficiently protect European farmers.
“In a post-Mercosur context, the cumulative impact of successive trade agreements makes these concessions unacceptable,” the lobby said, adding: “European farmers cannot continue to absorb the cost of bilateral trade liberalisation without adequate and truly effective safeguards.”
The EU-Australia agreement sets quotas for sensitive products including beef (30,600 tonnes a year phased in over 10 years), sheep meat (25,000 tonnes a year over seven years), sugar (35,000 tonnes) and rice (8,500 tonnes phased in over five years).
But Copa-Cogeca warned that these figures add to quotas already allocated to Mercosur countries — Brazil, Argentina, Uruguay and Paraguay — including 99,000 tonnes for beef and existing sugar quotas with Brazil and Paraguay.
The Commission included a safeguard mechanism allowing the EU and Australia to impose temporary measures within the first seven years if a sudden increase in imports leads to major market disruption in either partner’s market.
However, the lobby described these measures as mere “communication tools,” with one representative telling Euronews that “they will be slow to activate if a market crisis occurs.”
Some MEPs already voiced concern
Before ratification, the deal must run the gauntlet of EU member states and MEPs, who have already challenged the legality of the Mercosur deal before the EU Court of Justice, delaying its ratification.
Some lawmakers have already come out against the Australia deal.
“A rude awakening this morning on learning that, once again, Ursula von der Leyen went it alone in the trade deal with Australia,” Belgian farmer and liberal MEP Benoît Cassart said, adding: “We’re set to face additional imports in sensitive sectors such as beef and sugar, even though we already raised concerns about this situation in the case of Mercosur.”
There were also concerns about the safeguarding of protected regional food names.
The EU protects “Geographical Indications” (GIs) for food and drink products linked to their place of origin.
Under the deal, 165 EU agri-food GIs and 231 EU spirit drink GIs are protected.
However, for cheeses such as the Greek "Feta" and French "Gruyère," Australian producers who have used these names in good faith and continuously for at least five years prior to the agreement will be allowed to keep using them.
These products will be “put at risk”, Cassart said.
Meanwhile, Italy's "Prosecco" wine triggered strong reactions from Italian lawmakers.
According to an EU official, under the agreement, Australian producers can continue using “Prosecco” to designate a grey grape variety in Australia, provided it is used as a variety name and tied to Australian geographical indications. This rule applies solely within Australia, which has also agreed to halt exports of such wines after 10 years.
But Italian Five Star MEP Carolina Morace argued that “with this decision, the European Commission is legalizing ‘Italian sounding,’ that is, the imitation of our agri-food excellence around the world.”
“As a Venetian, I can only reject this latest attack on our traditions, which weakens rather than strengthens Italy’s wine sector.”
Before ratification, the deal must run the gauntlet of EU member states and MEPs, who have already challenged the legality of the Mercosur deal before the EU Court of Justice, delaying its ratification.
Some lawmakers have already come out against the Australia deal.
“A rude awakening this morning on learning that, once again, Ursula von der Leyen went it alone in the trade deal with Australia,” Belgian farmer and liberal MEP Benoît Cassart said, adding: “We’re set to face additional imports in sensitive sectors such as beef and sugar, even though we already raised concerns about this situation in the case of Mercosur.”
There were also concerns about the safeguarding of protected regional food names.
The EU protects “Geographical Indications” (GIs) for food and drink products linked to their place of origin.
Under the deal, 165 EU agri-food GIs and 231 EU spirit drink GIs are protected.
However, for cheeses such as the Greek "Feta" and French "Gruyère," Australian producers who have used these names in good faith and continuously for at least five years prior to the agreement will be allowed to keep using them.
These products will be “put at risk”, Cassart said.
Meanwhile, Italy's "Prosecco" wine triggered strong reactions from Italian lawmakers.
According to an EU official, under the agreement, Australian producers can continue using “Prosecco” to designate a grey grape variety in Australia, provided it is used as a variety name and tied to Australian geographical indications. This rule applies solely within Australia, which has also agreed to halt exports of such wines after 10 years.
But Italian Five Star MEP Carolina Morace argued that “with this decision, the European Commission is legalizing ‘Italian sounding,’ that is, the imitation of our agri-food excellence around the world.”
“As a Venetian, I can only reject this latest attack on our traditions, which weakens rather than strengthens Italy’s wine sector.”
By AFP
March 23, 2026
European Commission President Ursula von der Leyen (2nd L) participates in a traditional Aboriginal smoking ceremony along with Australia’s Governor-General Sam Mostyn (C) during a visit at Admiralty House in Sydney on March 23, 2026. - Copyright AFP Saeed KHAN
EU chief Ursula von der Leyen arrived in Australia on Monday, with hopes a free trade deal can be struck after years of negotiations.
It is the EU chief’s first trip to Australia since taking office and comes as the bloc and import-reliant nation navigate renewed energy vulnerability sparked by the war in the Middle East.
She arrived in Sydney on Monday for a meeting with Australia’s head of the state, the Governor-General, and a traditional welcoming ceremony.
From Sydney, the EU chief will head to Canberra, where she is expected to meet Prime Minister Anthony Albanese and address the country’s parliament.
Von der Leyen is joined by EU trade commissioner Maros Sefcovic — sparking speculation the two sides may finally put pen to paper on a long-awaited free trade deal.
Both are still ironing out the details of the agreement, with improved access to the European market for Australia’s lamb and beef a key source of contention.
Australia has previously said it could drop a luxury car tax on European vehicles in return for greater access to the EU agriculture market.
The country’s use of geographical indicator names for cheese and wine products was also a sticking point.
Australia’s largest export market is China and the United States is its largest source of investment.
But Canberra has redoubled efforts to diversify export markets for farmers since a 2020 dispute with Beijing saw agriculture exports blocked for several years, and then last year’s global imposition of US trade tariffs.
The European Union is Australia’s third largest two-way trading partner and second largest source of foreign investment.
Trade Minister Don Farrell last week said that an EU deal would add Aus$10 billion (US$7.1 billion) in trade for Australia in the first year.
“They are potentially our second largest trading partner if we can pull this off, and we’ve just got to get over those last few hurdles,” he told Sky News Australia.
Front and centre in meetings will also likely be the war in the Middle East, which has sent oil prices soaring.
In Canberra, International Energy Agency chief Fatih Birol said on Monday the world faced an energy crisis not seen in decades if the conflict was not resolved.
And Von der Leyen this month said the conflict had served as a “stark reminder” of the continent’s vulnerabilities.
Australia — which is heavily reliant on fuel from abroad — has also felt the pressure from the global energy squeeze.
While conceding that some petrol stations had run out of fuel, Energy Minister Chris Bowen said Monday the country was a “long way” from rationing.
Europe is no longer prepared to be drawn, by default, into an open-ended military operation in the Middle East.
People demonstrate in Madrid, Spain, on March 21, 2026, against the war involving Iran.
(Photo by Tomas Calle/NurPhoto via Getty Images)
Hana Saada
Mar 23, 2026
What is unfolding across European capitals is not merely dissent over a particular conflict; it is the quiet reconfiguration of alliance behavior under conditions of escalating risk. The refusal voiced in Madrid—most starkly articulated by Spain’s Transport Minister, Óscar Puente, who declared that his country would not go “even around the corner” with Israeli Prime Minister Benjamin Netanyahu—signals something more consequential than diplomatic disagreement.
Delivered in unusually blunt terms, his remark crystallized a broader political reality: Europe is no longer prepared to be drawn, by default, into an open-ended military escalation against Iran. It marks, in effect, the visible boundary of a strategic threshold the continent is no longer willing to cross.
For decades, transatlantic alignment functioned on the presumption of convergence: that when Washington moved, Europe would calibrate—but ultimately align. That presumption is now under strain. The prospect of a US-Israeli military aggression against Iran has exposed a widening gap between American strategic impulses and European risk tolerance.
The divergence is not ideological. It is structural. European governments are confronting a scenario in which escalation offers limited strategic clarity but immediate systemic exposure. They are being asked, in effect, to underwrite a conflict defined by uncertain objectives, fluid escalation dynamics, and a disproportionate economic burden—without corresponding influence over its conduct or conclusion.
The era of automatic convergence is giving way to one of selective alignment, where interests are weighed more carefully, risks are more openly acknowledged, and participation in conflict is no longer the default expression of alliance.
Spain’s position, far from anomalous, crystallizes this dynamic. The refusal to facilitate or politically endorse escalation reflects a broader European instinct toward insulation. Berlin’s caution, Paris’s distance, and the European Union’s emphasis on deescalation all point in the same direction: a deliberate effort to decouple European stability from the volatility of a conflict it neither initiated nor controls.
At the center of this recalibration lies energy vulnerability. The Strait of Hormuz—through which between 17 and 20 million barrels of oil pass daily—remains the most immediate point of systemic exposure. Any disruption, even partial, would transmit shockwaves through European economies already navigating inflationary pressures and fragile growth trajectories. Oil prices hovering around $115 per barrel, with credible projections reaching $150-$175 under sustained disruption, are not abstract indicators; they are policy constraints.
This economic dimension has begun to reshape strategic language. Where earlier discourse emphasized deterrence and enforcement, current formulations increasingly prioritize stability, containment, and the avoidance of escalation spirals. The postponement of strikes on Iranian energy infrastructure, following what Washington described as “productive” engagement, underscores the extent to which strategic decisions are now bounded by economic risk.
Equally significant is the absence of decisive outcomes on the ground. The escalation has yet to produce the structural breakthroughs that would justify its expansion. Assertions of operational success coexist with the persistence of institutional continuity within Iran, where governing structures remain intact and operationally coherent. In strategic terms, the conflict has generated pressure without resolution—a condition that complicates both escalation and exit.
Under these circumstances, Europe’s posture begins to take on a different meaning. It is not hesitation, nor is it disengagement. It is a recalibration of agency. By declining automatic alignment, European states are asserting a form of strategic autonomy that had long been subordinated to alliance cohesion. The message is not framed in declarative terms, but its implications are unmistakable: Participation is no longer assumed; it is contingent.
This shift does not dissolve the transatlantic relationship, but it does redefine its operational boundaries. It introduces friction where there was once fluidity, and conditionality where there was once reflex. Most importantly, it signals that the costs of alignment—economic, political, and strategic—are now subject to explicit calculation rather than implicit acceptance.
The significance of Spain’s stance, therefore, lies not in its rhetoric, but in what it reveals about the evolving architecture of Western power. The era of automatic convergence is giving way to one of selective alignment, where interests are weighed more carefully, risks are more openly acknowledged, and participation in conflict is no longer the default expression of alliance.
In that sense, Europe’s refusal to go “even around the corner” is not a momentary divergence. It is an early indicator of a deeper transformation—one in which the boundaries of Western cohesion are being redrawn in real time.
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Hana Saada
Dr. Hana Saada is an Algerian university lecturer and journalist, and Editor-in-Chief of the English edition of Dzair Tube. She holds a PhD in Media Translation and writes on geopolitics, media narratives, and international affairs.
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