Australia EU FTA: Better and stronger together

By Frances Sagala, Ambassador of Australia to Sweden, Finland and Latvia writes in Mundus News Sweden and Mundus News Finland.

Australia EU Free Trade Agreement

In an historic visit to Australia this week by European Commission President Ursula von der Leyen, Australia and Europe have taken a great step forward and reaffirmed our shared commitment to stability, prosperity and security, anchored in sovereignty. I am pleased to share this week’s positive news with Mundus readers especially all the friends of Australia in Sweden, Finland and Latvia. The announcements made by the Prime Minister of Australia Anthony Albanese and President von der Leyen on the Australia EU Free Trade Agreement, will bring Australia and Europe even closer together. 

Australia has long stood in solidarity with Europe in difficult times and is a steadfast supporter of Ukraine in the face of Russia's illegal full-scale invasion. As Europe’s prosperity is increasingly connected to the growth and stability of the Indo-Pacific, Australia becomes an ever more important economic, research and security partner.

At a time when Europe is grappling with cost-of-living pressures and uncertainty in global markets, the conclusion of negotiations for a Free Trade Agreement (FTA) with Australia is a great achievement which will add around €4 billion to Europe’s GDP by 2030. It will create new jobs, increase EU exports by a third and give companies better access to Australia’s market. This agreement also sends a message to the world that we stand for free and fair trade and for predictable rules.

Australia’s high degree of integration into Indo-Pacific economies through a long-standing network of FTAs also provides a launch pad for European businesses to reach the region’s 5 billion consumers. The FTA is explicitly designed to assist small and medium enterprises by lowering trade barriers and cutting red tape. EU businesses are set to save €1 billion in duties per year. This is fantastic news for Swedish, Finnish and Latvian businesses and their employees. 

With Sweden, Finland and Latvia’s ambitions across artificial intelligence, technology, sustainable transport, energy and defence industry, the commitments contained in the FTA to enable European access to secure and reliable supplies of Australian critical minerals is key. Australia is the world’s top producer of lithium and home to some of the world’s largest deposits of the key critical minerals needed for these industries. Australia, Sweden and Finland are global leaders in safe and sustainable mining, with around 80% of the world’s underground mining technology originating from Finland and Sweden.

The FTA will improve choice for consumers and reduce the cost of goods and services as barriers are eliminated on high quality Australian products in the European market. By reducing the barriers to Australian investors, the FTA will also provide incentives for Australia’s large investment funds to further invest in the EU.

In addition, the signing in Canberra this week of an Australia-EU Security and Defence Partnership reflects a commitment to work together to protect our shared security interests. The partnership will boost cooperation across defence industry, cyber, economic security, counter-terrorism, combatting all forms of hatred and countering hybrid threats. 

Australia and the EU have also agreed to commence negotiations on association to Horizon Europe – the EU’s flagship research and innovation funding program. This will give Australian organisations access to the world’s largest pooled research fund in 2027. And will bring Australia’s brightest minds, our top universities and research institutes, and our funding to collaborate with Swedish, Finnish and Latvian partners on the biggest challenges of our time, from climate change to cutting-edge technology and the next generation of healthcare.

These three important pillars of cooperation recognise the value of a strong Australia-EU partnership in addressing global challenges and supporting prosperity and security. I look forward to seeing the benefits flow for us all.

Building on our success 

Nordic and Baltic business have long seen growth and innovation in the Australian market. Australia’s entire 5G network infrastructure is built in partnership with Swedish and Finnish technology. Telstra, Optus and Vodafone all rely on Ericsson and Nokia to deliver world class connectivity across a continent. And Latvia’s Aerones has brought its world-leading robotics technology to support Australia’s net zero transition. And great Australian inventions include the electronic pacemaker, the inflatable aircraft escape slide, the vaccine for human papilloma virus, Google Maps, Wi-Fi and the cochlear implant. These examples highlight how we are not just trading partners, but true capability partners, delivering cutting-edge innovations to the world.

Our most important resource – our people 

Our societies support our people to reach their full potential and the announcements this week do this by delivering benefits to our citizens. The announcements this week will increase opportunities for cross border mobility between Australia and the EU. This is excellent news for Australians, Swedes, Finns and Latvians as we work so well together with our commitment to respect and fairness. The FTA will boost mobility as it contains advanced provisions on the movement of professionals for business purposes, such as managers or specialists that EU companies post to their subsidiaries in Australia and their family members, or EU professionals supplying certain services in Australia for a period of up to six months, as well as specific types of work placements for up to four years.

The FTA will also facilitate research and innovation collaboration through a new Innovation Mobility Pathway. Under the pathway, eligible EU researchers can undertake research placements and internships in Australia for up to three years. Eligible EU researchers and technical specialists will be able to come to Australia to exchange skills and undertake workplace-based training for up to one year.

As Prime Minister Anthony Albanese said this week ‘as the world grows ever more uncertain, our best way of navigating the new reality is for us to do more together. Not merely as a safeguard against present volatility or future uncertainty, but as the foundation for our future prosperity, resilience, security and stability.’ 

Australia, Sweden, Finland and Latvia – worlds apart, but now closer than ever.