EU-Australia trade agreement/ What are companies expected to benefit from?
After eight years of negotiations, 15 rounds of talks and a stalled negotiation in 2023, the EU and Australia signed a long-awaited free trade agreement early last week. The deal marks another victory for Brussels as it rushes to diversify trade ties and secure strategic partners amid rising global tensions.
In 2025, the EU exported goods worth €36.9 billion to Australia, while imports amounted to €10.2 billion. This left the bloc with a trade surplus of €26.7 billion, according to the latest Eurostat data. Both exports and imports fell slightly compared to 2024, by 4.9% and 4.8% respectively.
However, in the long term, trade has increased significantly. Since 2015, exports have increased by almost 40% and imports by almost 50%.
The EU's main exports to Australia were medicinal and pharmaceutical products, accounting for 13.1%, followed by road vehicles at 11.1% and industrial machinery at 9.5%.
On the import side, coal, coke and briquettes dominated, accounting for 29% of all imports. These were followed by oilseeds and oil fruits with 15.3% and gold with 7.2%.
According to the European Commission, trade between the EU and Australia is expected to grow by up to 33% over the next decade, with the value of exports expected to reach up to €17.7 billion per year. Some key sectors for the EU include dairy products (expected to grow by up to 48%), motor vehicles (52%) and chemicals (20%).
In addition, under the agreement, more than 99% of tariffs on EU exports to Australia will be eliminated, saving businesses around €1 billion per year.
The EU also reinforces its strategic interests in the area of critical raw materials, as Australia is a major producer of raw materials, including aluminium, lithium and manganese, which are vital to the EU's overall economic security and competitiveness.
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