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Australia’s EU free trade deal has collapsed

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Negotiations for a trade deal between the European Union (EU) and Australia have collapsed following another round of unsuccessful talks.
Australia EU trade deal

Negotiations for a trade deal between the European Union (EU) and Australia have collapsed following another round of unsuccessful talks.

Australian Trade Minister Don Farrell met his EU counterparts in Japan on the weekend with hopes to finalise the agreement.

However, no progress was made. With the possibility of future talks likely to be stalled by future election cycles, it could now be years before an agreement is reached.

Free Trade deal

Most countries restrict what other countries can bring into their markets. This can include bans of certain goods, but more commonly takes the form of ‘tariffs’ (taxes).

When countries negotiate trade deals, they’re seeking better access for their exporters and reduced import restrictions.

Australia and the EU – which negotiates trade deals as one entity on behalf of 27 countries – have been discussing a new trade deal since 2018.

Naming rights

Before negotiations restarted in Japan, three earlier rounds of talks had failed.

A major sticking point was the EU’s insistence on ‘geographic indicators’ to restrict naming rights for products not manufactured in their ‘traditional’ place of origin.

A common example is champagne. Over many years, France has secured the agreement of over 100 countries, including Australia, to grant exclusive use of the name ‘champagne’ to wine made in the Champagne region of France according to traditional methods.

The Australian Government strongly opposed restrictions on the names of Australian products.

Under an agreement including ‘geographic indicators’, Australian-made products like prosecco, parmesan and feta would’ve had to change their name.

Latest negotiations

Australian Trade Minister Don Farrell said he walked away from negotiations after the EU failed to put forward an improved deal from what Australia had already rejected.

The European Commission said it “regrets” the lack of progress in Japan. It accused Australia of reintroducing demands that “did not reflect recent negotiations and the progress between senior officials”.

The Australian Government has denied this.

What now?

The Australian Government told the EU that any agreement on a future deal is unlikely before 2025, when a new term of Federal Parliament is set to begin.

Negotiations will also stall due to EU elections, set to take place in June next year. It will be difficult for the EU to negotiate during an election cycle, as the composition of the European Parliament is subject to significant change.

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