After nearly a decade of stop-start negotiations, the EU-Australia free trade deal has finally crossed the finish line.
“Australia used to have Europhobia — now we have at least some Eurovision,” Tim Harcourt of the University of Technology Sydney told DW. Talks nearly collapsed as recently as 2023, derailed by fierce opposition from Australian farmers over beef quotas. Experts say the agreement’s survival owes less to changes in the fine print and more to a shifting, more combative global trade landscape.
New deals in a new trade order
Rising US tariffs have squeezed both Australian meat exports and European carmakers. At the same time, China’s willingness to weaponize access to critical minerals has pushed Europe to secure alternative supplies. Against that backdrop, the deal offers both sides relief and reassurance.
“There’s a lot more at stake in this day and age,” Evgeny Postnikov of the University of Melbourne told DW. “It’s no longer the time to sacrifice vital agreements to particular domestic interests.” EU Trade Commissioner Maros Sefcovic, in Canberra alongside European Commission President Ursula von der Leyen, said the pact sends a strong signal in favor of low — in this case no — tariffs and rules-based cooperation.
The agreement is part of a broader push by Brussels, which has also been sealing major trade pacts this year with Mercosur and India.
Stuck in the middle
Australia ranks around 20th among the EU’s trading partners, but its strategic value is rising. For Europe, the deal helps reduce dependence on the United States while strengthening ties with so-called “middle powers” that increasingly shape global trade. Australia is a member of the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), a bloc accounting for roughly 15% of global trade. “A deal with Australia is effectively a gateway into the CPTPP network and a much larger opportunity for European firms,” said Holger Görg of the Kiel Institute for the World Economy.
The crux: critical raw materials
One of the biggest prizes for Brussels lies underground. Australia holds the world’s third-largest reserves of rare earth elements and is the top global producer of lithium, a cornerstone of batteries for electric vehicles. European and German carmaker associations have expressed support for the trade deal. Access to these minerals matters more than ever as China has tightened its grip on supplies, raising fears of disruptions just as Europe accelerates its green and digital transitions. “What has become clear in the past two years is that we should never be too dependent on other partners when it comes to critical raw materials,” Görg said.
The meat of the deal
For Australia, the headline gain is better access to the EU’s 450 million consumers. Nearly all EU tariffs on Australian agricultural exports — from wine and olive oil to most dairy — will be scrapped. There are symbolic wins too: the EU will, for now, allow Australian producers to continue using protected names like parmesan and feta, and Australia will become the only country outside Italy allowed to label its sparkling wine as prosecco.
Beef, however, remains the most contentious issue. Under the deal, Australian beef quotas will rise more than tenfold over the next decade — from 3,389 metric tons to 30,600 tons annually. That increase falls short of Canberra’s ambitions, and Australian farmers remain unimpressed; the National Farmers’ Federation said they were “extremely disappointed” with the outcome.
Still, the deal’s survival despite domestic backlash signals a broader shift: in a more fractured, competitive global economy, strategic trade partnerships are increasingly being prioritized over particular domestic interests.
Edited by: Srinivas Mazumdaru