European UnionchiefUrsula von der Leyenand Australian Prime MinisterAnthony Albanesestruck a long-awaited free trade deal on Tuesday, compromising to boostexportsin the face of global uncertainty over trade.
Von der Leyen's visit toAustraliawith trade commissioner Maros Sefcovic in tow comes as the 27-nation bloc and the import-reliant nation navigate renewedenergyvulnerability sparked by the war in theMiddle East.
The accord is the latest agreed byBrusselsin a push to diversify trade asEuropefaces challenges from the United States andChina.
The two sides also inked an agreement to step updefencecooperation as well as critical raw materials.
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 andAustraliawere bound by common values and must work together to mitigate over-reliance on countries like 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".
Key sticking points on Australian use of European geographical names and access for Australian beef to Europe were overcome to reach the deal, inked after eight years of negotiations.
A compromise will see Australian winemakers allowed to use the term "prosecco" domestically, but stop using it forexportsafter 10 years.
Australiawill be allowed to keep using some geographical names, such as feta and gruyere, in cases where producers have used the name for at least five years.
European car makers will benefit fromAustraliaraising the threshold for a luxury car tax on electric vehicles -- three-quarters of EVs will now become exempt.
Under the trade deal, the EU said it expected exports toAustraliato grow by a third over a decade.
The quota of Australian beef allowed into the EU will increase more than 10 times the current level over the next decade, although that falls short of the level Australian farmers had been seeking.
EU firms exported 37 billion euros ($42.9 billion) of goods toAustralialast year, and 31 billion euros of services in 2024.
Global uncertainty
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 last year's global imposition of US tradetariffs.
Likewise, the European Union 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.
In Canberra, International Energy Agency chief Fatih Birol warned 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 Europe's vulnerabilities.
On Tuesday, she called for an immediate end to hostilities in the Middle East 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.
(FRANCE 24 with AFP)
Originally published on France24
