Australia and European Union poised to sign trade deal
Michael Read - Mar 17, 2026
Australia and the European Union could sign a long-awaited free trade deal as soon as next week, as escalating global trade tensions force them back to the negotiating table after years of deadlock.
The negotiations collapsed in October 2023 over Australia’s demands for greater market access for locally produced beef, sheep meat, dairy and sugar.
But momentum to finalise a deal gathered steam as US President Donald Trump waged a trade war and imposed swingeing tariffs globally.
The EU has also clinched deals with South American countries and India.
European Commission President Ursula von der Leyen was expected in Australia as soon as next week to finalise the deal, after telling EU leaders on Monday that talks were “in the final stretch”, according to Bloomberg.
“This will mark yet another milestone in diversifying Europe’s international partnerships,” she said.
The accord would enhance “Europe’s ability to shape global standards and ensure resilient supply chains”.
Access for Australian red meat exports to Europe remains a sticking point, but the matter can be settled only at the leader level by Albanese and von der Leyen.
Trade Minister Don Farrell met virtually overnight with his EU counterpart, Maros Sefcovic, to cover off on outstanding issues.
“I am confident we can do a deal and look forward to continuing to work with him to reach an agreement that is in Australia’s national interest,” Farrell told The Australian Financial Review.
The deal has been held up by opposition from Irish and French farmers who are wary of the prospect of greater competition from Australian meat exports.
However, Ireland’s ambassador to Australia, Fiona Flood, said on Tuesday she looked forward to closing the trade deal with Australia.
“I think we can all be very hopeful that, in these turbulent times, it’s a beacon of hope that we can close that trade deal,” she told the ABC.
A potential compromise on meat exports could mean Australia cuts or drops the luxury car tax, which was introduced in 2000 to protect the now-extinct local car manufacturing industry and which disproportionately affects European manufacturers such as BMW and Mercedes-Benz.
The tax levies an additional 33¢ on every dollar spent above $80,567 for petrol and diesel vehicles or $91,387 for hybrids and electric vehicles sold, raising $1.2 billion a year revenue for the federal government.
Europeans, concerned their vehicles have been priced out of the Australian market by cheaper Chinese electric vehicles, want to see the tax relaxed.
The free trade deal was also expected to include a two-way mobility agreement, where highly skilled professionals and investors would be able to work in Europe more easily.
It would not, however, allow Australians to live and work freely in the EU, nor would it allow Europeans to live and work freely in Australia.
Since negotiations for an FTA began in 2018, the EU had demanded Australian businesses stop using so-called “geographical indicator” product names, arguing they should be the sole domain of European growers.
However, it appeared a compromise had been reached allowing Australian growers to continue using the product labels, according to two sources speaking on condition of anonymity, although they stressed that negotiations were continuing.
https://www.afr.com/policy/foreign-affairs/australia-and-european-union-poised-to-ink-trade-deal-20260317-p5obw0