Prime Minister Albanese and EU Commission President Ursula von der Leyen reached an agreement on the trade deal in March, after eight years of negotiations. The agreement is intended to significantly expand mutual trade but still needs to be considered by the Australian parliament. Especially the arrangements concerning agriculture and climate face political resistance.
Opposition divided
Australia has never before had a free trade agreement rejected by parliament. That now threatens to happen for the first time. The conservative opposition believes Australian farmers gain insufficient access to the European market. The existing European import tariffs on Australian steel remain a major objection as well.
Within the conservative coalition of Liberals and Nationals, there is disagreement about the direction to take. Nationals leader Matt Canavan wants to block the agreement with the EU. The Liberals are, for now, more cautious. Their financial spokesperson Tim Wilson emphasizes that the final legislation is not yet available.
Greens
That means the decision could end up in the hands of the Greens. The ruling Labor Party does not have a majority in the Senate and without support from conservatives must rely on the ten Green senators. However, the Greens have not yet taken a position.
Meanwhile, Trade Minister Don Farrell refuses to renegotiate with Brussels. According to him, the agreement is final and the parliament must choose between acceptance and rejection. He warns that Australia would economically harm itself by rejecting the agreement. He also calls on businesses to put pressure on the opposition.
Meat export
Australian livestock farmers especially feel they benefit too little from the new trade agreement. The deal provides for access to the European market of 35,000 tons of beef and 30,851 tons of sheep and lamb meat, with a gradual expansion over seven to ten years. Farmer organizations find those quantities insufficient, partly due to European agricultural subsidies.
Environmental regulations
The climate provisions also cause political division. The conservative opposition opposes European environmental regulations and carbon standards. The Greens, on the other hand, are more favorable to such agreements, but that does not necessarily mean they will support the entire trade agreement. The disagreement within the opposition makes the parliamentary outcome uncertain.
Other Australian industries see major benefits, however. The mining sector expects better access to European buyers of important minerals. Europe also wants to abolish import tariffs on wine, fish products, and various agricultural products. Australia in turn removes import duties on European cars, clothing, and foodstuffs.
