The reason for the European Union-Australia trade negotiation hiccup - Though trade talks have fallen through for now, the
Coherent Identifier 20.500.12592/n5m3gp

The reason for the European Union-Australia trade negotiation hiccup - Though trade talks have fallen through for now, the

2 November 2023

Summary

The negotiations, which had been expected to conclude positively before the end of this year, will probably not reopen before 2025, after the European election of June 2024 and the next Australian general election due sometime the following year.  Why this sudden hiccup in the trade relations between the two partners, which have much in common economically and politically? Seen from Brussels, Aust. [...] In economic terms, this complementary of comparative advantage between Australia and the EU should be a source of economic gains and encourage the two countries to sign a trade deal.  But in political economic terms, the situation is exactly the opposite. [...] The average applied tariff for non-agricultural products is in fact lower in Australia (2.6 percent) than in the EU (4.1 percent), whereas for agricultural products it remains much higher in the EU (11.4 percent) than in Australia (1.2 percent) (WTO ITC UNCTAD, 2023). [...] Critical materials Does this asymmetry between the EU and Australia means that in fact the EU is in a strong position relative to Australia because it has the bigger market, while Australia has already opened its own market by largely dismantling its protection in manufactures, the EU’s main area of comparative advantage?  The reason for the European Union-Australia trade negotiation hiccup 3 Brue. [...] Australia sells most of its lithium to China for processing.  Australia’s strong position in critical raw materials, which the EU needs for its green industrial transformation, is a golden opportunity for the country to prize open the EU market for beef and sheep, which it has long eyed with, until recently, little hope of succeeding.

Pages
5
Published in
Belgium