No trade negotiations with EU likely until 2025 after talks fail

Trade negotiations between Australia and Europe over market access for meat products and naming right protections are unlikely to resume before the next term of government after talks collapsed overnight.

A last-ditch attempt to secure a free trade agreement with the EU collapsed on Sunday on the sidelines of trade minister G7 meetings in Japan before formal negotiations between Trade Minister Don Farrell and the EU’s Valdis Dombrovskis could start on Monday.

Trade Minister Don Farrell Farrell says he has “no qualms” walking away from negotiations without a better deal on offer from the EU.Credit: Alex Ellinghausen

Farrell said he had “no qualms” walking away from negotiations without a better deal on offer from the EU, and on Monday morning Agriculture Minister Murray Watt said there was no major change to the continental bloc’s offer.

“Unfortunately, they haven’t been prepared to put on the table a significantly better offer than what they’ve offered before,” Watt said on ABC RN radio.

In July, the last round of official negotiations in Brussels also ended without a deal because the EU was not offering enough access for Australian agricultural products, particularly beef and sheep meat as well as sugar and dairy.

Watt said in the latest negotiations, the EU came back with “essentially the same offer” as July, but with a couple of small tweaks.

“We just weren’t able to see the EU increase its offer for things like beef, sheep, dairy, sugar, enough for us to think that this deal was in Australia’s national interest,” Watt said.

A European Commission spokesperson said the discussions in Osaka did not progress because Australia re-tabled demands for agricultural access that “did not reflect recent negotiations and the progress between senior officials”.

The collapse of trade talks with the EU means there are unlikely to be further negotiations until 2025, as the EU enters an election period early next year and Australia will enter one at some point after that. The next federal election is due in mid-2025.

“In future, it may be that we can resume negotiations, but I think that will be some time away,” Watt said.

“We’ve made clear to them that we think it’s unlikely to occur within this current term of the Australian parliament as well.”

Industry and Science Minister Ed Husic backed the decision to walk away from a deal, but said there were still ways of working with the EU on investing and diversifying Australia’s critical minerals industry.

“We have the biggest store of critical minerals on the planet, they’re crucial to help us speedily along the transition to net zero,” he said.

“And I still think there’s a lot of scope for us to work with the EU on a whole range of other things, and we’re still willing to talk with them.”

Opposition trade spokesman Kevin Hogan said it was unfortunate the deal had fallen over, but the offer on the table for agricultural product access to Europe was not good enough.

“The EU offer on geographical indicators would have also been too restrictive, particularly for products like parmesan, feta and prosecco,” he said.

National Farmers Federation president David Jochinke said the trade minister had made the tough but right call to walk away from an “unacceptable offer”, but said the government should keep talking with the EU.

“It’s disappointing the Europeans weren’t willing to put something commercially meaningful on the table. This was always going to be a tough negotiation with no guarantee of an outcome,” he said.

Australia and the EU began working on a free trade agreement in 2018, but progress was put on ice by the European Union in 2021 after Australia took France by surprise by cancelling a submarine contract to instead take up a deal for US nuclear submarines through the AUKUS agreement.

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