Published by Global Banking & Finance Review®
Posted on March 23, 2026
3 min readLast updated: March 23, 2026
Add as preferred source on GoogleThe EU is in the final stretch of free trade negotiations with Australia, aiming to diversify trade beyond U.S. tariffs and China reliance. The deal could boost EU exports by a third over 10 years, especially in wine, spirits, machinery and raw materials.
By Philip Blenkinsop
BRUSSELS, March 23 (Reuters) - The European Union is in the "last mile" of negotiations over a trade deal with Australia, an EU Commission spokesperson said on Monday, as it moves to diversify its trade to mitigate the impact of U.S. tariffs and reduce its reliance on China.
The European Commission, which oversees trade policy for the 27-nation bloc, has accelerated talks to secure free trade agreements since President Donald Trump launched a global tariff offensive last year and China curbed exports of critical minerals.
It has already struck trade accords with Indonesia and India over the past six months.
European Commission President Ursula von der Leyen is visiting Australia with European Trade Commissioner Maros Sefcovic for the likely conclusion of an agreement with Australian Prime Minister Anthony Albanese.
"She will meet Prime Minister Albanese very late our evening, early Tuesday morning Canberra time and the goal is to tie down the final details," a Commission spokesperson in Brussels said. "But ... as Commissioner Sefcovic likes to say, the last mile is the hardest."
DEAL TO BOOST EU EXPORTS TO AUSTRALIA BY A THIRD IN 10 YEARS
The EU executive says EU exports to Australia, its 20th largest trading partner, should rise by a third 10 years into the proposed deal. The EU exported goods worth 37 billion euros ($42.86 billion) to Australia in 2025 and 28 billion euros of services in 2023.
The agreement is expected to result in tariff reductions, which the EU has said could remove 1 billion euros in duties paid for its exports.
The European Union is eyeing benefits for European wine and spirits and machinery, including vehicles. Australia currently charges a 33% duty on imported luxury cars.
Talks between the two sides collapsed in 2023 over the issue of market access for Australian farm produce into the European Union. The bloc is likely to set quotas for sensitive products like beef, lamb and mutton, sugar and rice.
For beef, a flashpoint for farmer demonstrations over the EU's deal with South American bloc Mercosur, the annual quota is likely to be around 30,000 metric tons, EU officials say.
The agreement is also likely to result in improved EU access to critical raw materials mined in Australia, such as aluminium, lithium and manganese.
($1 = 0.8632 euros)
(Reporting by Philip Blenkinsop; Editing by Joe Bavier)
The main goal is to boost EU exports to Australia, reduce tariffs, and diversify trade to mitigate U.S. tariffs and reliance on China.
EU exports to Australia are expected to rise by a third within 10 years of the trade deal.
European wine, spirits, machinery, including vehicles, and critical raw materials such as aluminium, lithium, and manganese are expected to benefit.
Talks collapsed in 2023 due to disagreements over market access for Australian agricultural products in the EU.
Yes, the agreement is expected to result in significant tariff reductions and quota agreements, especially for sensitive agricultural products.
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