Australia has finalised a landmark Free Trade Agreement (FTA) with the European Union, a deal expected to expand market access for Australian manufacturers and strengthen economic ties with one of the world’s largest economies.
In a media release, Prime Minister Anthony Albanese said the agreement, concluded after nearly eight years of negotiations, will deliver “benefits for both Australia and the European Union for generations to come,” noting that it opens the EU’s $30 trillion economy to Australian goods and services.
“This deal creates major new opportunities for Australian exporters in the European Union’s massive economy, and will reduce costs for Australian consumers,” Albanese added.
According to the Australian Trade and Investment Commission (Austrade), once fully implemented, 98 per cent of the current value of Australia’s exports will enter the EU duty-free, including almost all Australian exports of manufactured goods, machinery, critical minerals, and hydrogen.
Tariffs on advanced manufacturing products such as machinery, electrical goods, auto parts, textiles, chemicals, and pharmaceuticals will be eliminated, providing a boost to Australia’s manufacturing sector.
Minister for Trade and Tourism Don Farrell described the agreement as “strategically important and economically valuable,” highlighting that it delivers “real commercial gains for Australian exporters, farmers and producers into a market that has been difficult to enter or effectively closed for decades.”
He said the removal of EU tariffs offers Australian businesses the chance to diversify trade with 27 European countries and 450 million consumers.
Dr Jens Goennemann, managing director of the Advanced Manufacturing Growth Centre (AMGC), said the deal represents a significant opportunity for small and medium manufacturers.
“This agreement has been a long time in the making, and it’s a meaningful step forward for Australia’s small and medium manufacturers, opening access to like-minded European markets,” Goennemann said.
He added that the next challenge will be “turning access into action – helping Australian manufacturers scale, partner and compete globally,” ensuring smaller manufacturers actively participate in value-added exports.
The agreement also includes measures to improve two-way investment and facilitate access to European government contracts, while Australian professionals will benefit from streamlined recognition of their qualifications in the EU.
Austrade noted that the FTA’s Innovation Mobility Pathway will allow Australian researchers, engineers, and technicians to travel, stay, and work within the EU, enhancing collaboration in high-tech and industrial sectors.
The FTA is expected to enter into force once both Australia and the EU complete their domestic processes, a timeline that could take up to two years.
Government and industry officials say the deal is expected to strengthen Australia’s industrial base, increase supply chain security, and provide new opportunities for exporters in manufacturing, agriculture, energy, and resources.
