James Adkins | Europe and Eurasia Fellow
Ursula von der Leyen and Anthony Albanese. Image sourced from Dati Bendo/European Commission via Wikimedia Commons.
While the United States (US) and China dominate Australian foreign policy debates, the European Union (EU) – the world’s third largest economy and an emerging geopolitical power – is frequently overlooked. Despite our geographical separation, the EU is an increasingly important partner for Australia at a time when the rules-based international order is coming under growing pressure. In an increasingly unstable and fragmenting world, Australia and the EU should strengthen our partnership based on our shared values and converging interests.
At its core, the EU-Australia relationship is rooted in shared values and cultural ties. Sharing a strong attachment to liberal democracy, human rights and cultural diversity, surveys show that Australians feel closer in values to the EU than even the US. The relationship is underpinned by deep people-to-people and cultural ties, with Australia home to large European diaspora communities and even competing in the Eurovision song contest. Despite these strong cultural affinities, the economic, security and political facets of the EU-Australia relationship have yet to reach their full potential.
Negotiations for an EU-Australia free trade agreement (FTA) were launched in 2018 but have dragged on for years without a deal. After hopes of conclusion last year, the talks collapsed due to disputes over agriculture in the lead up to the EU elections. With the new EU Commission now in place, and the Australian federal election due in early 2025, both sides should take advantage of increased political capital to make compromises on the contentious agricultural issues and refocus on achieving an agreement in 2025. The EU’s recent deal with the South American Mercosur bloc demonstrates that an agreement is possible with sufficient political will.
An EU-Australia FTA would offer compelling mutual benefits by allowing both sides to diversify their trading relationships. Both the EU and Australia have major dependencies on China which could be reduced through an FTA. For instance, Australian agricultural products have been the target of China’s economic coercion, while the EU is highly reliant on China for strategic raw materials. While the EU and Australia have recently signed a partnership on critical minerals, liberalising trade and investment flows through a comprehensive FTA would strengthen supply chain security and provide secure export markets between like-minded partners.
As key US allies which also have significant trade ties with China, the EU and Australia are confronted with similar geopolitical dilemmas. Their strategies towards China have converged in recent years, with the EU’s framing of China as a ‘partner, competitor and systemic rival’ echoing Australia's ‘cooperate where we can, disagree where we must, and engage in the national interest’ approach. While neither wish to take a Trump-style combative approach, both are clear-eyed about the risks posed by China’s increasing assertiveness and destabilising activities in areas such as the South China Sea.
The EU and Australia share a common interest in promoting peace, stability and prosperity in the Indo-Pacific region. In 2021, the EU published its first Indo-Pacific strategy, recognising the region’s growing strategic importance. With origins as a peace project and without a major military presence in the region, the EU has the advantage of been seen as a more benign partner compared to the US or China for Indo-Pacific states. Australia should leverage this point of difference and expand collaboration with the EU on regional development assistance – such as through the EU’s Global Gateway initiative – to present a viable alternative to China.
In response to growing ties between autocracies globally, the EU and Australia should deepen security cooperation and engagement in each other’s regions. The recent deployment of North Korean troops to support Russia’s war of aggression exemplifies the security linkages between the Euro-Atlantic and Indo-Pacific. If Putin were to succeed in Ukraine, then Xi Jinping would be emboldened to attempt a high-risk invasion of Taiwan. While Australia has been one of the leading non-NATO supporters of Ukraine, it should step up its military and financial assistance. For its part, the EU should leverage the clout of its sanctions regime to warn Beijing about the severe consequences it would face if it invaded Taiwan.
As advanced, knowledge-based economies, Australia and the EU should intensify engagement between policymakers and researchers to pool expertise. In particular, both share similar interests in regulating digital platforms and the energy transition. Australia’s recent passage of world-first age restrictions on social media and the EU’s pioneering carbon border adjustment mechanism are examples of issues on which to learn from one another. Furthermore, there is significant scope to deepen scientific research collaboration, such as through Australia joining Horizon Europe – the world’s largest research funding program – as an associate member.
Finally, the re-election of Donald Trump is a turning point which should spur greater EU-Australia coordination. Australia and the EU share a longstanding commitment to the rules-based international order underpinned by the United Nations, World Trade Organisation and other multilateral bodies. However, Trump’s return heralds a future in which the US is less committed to liberal internationalism. Australia and the EU should work together to exert pressure on Trump to moderate his ‘America First’ isolationism and encourage the US to remain engaged in multilateral forums.
At a time when the US is turning inwards and autocracies are undermining stability globally, the EU-Australia partnership is more important than ever. In coming years, Australia and the EU should strengthen their economic ties through an FTA, deepen security cooperation and intensify political dialogue to build resiliency against intertwined strategic risks. United by shared values and converging interests, Australia and the EU are likeminded partners whose relationship has huge untapped potential.
James Adkins is the Europe and Eurasia Fellow for Young Australians in International Affairs. He recently completed a Bachelor of Arts and Bachelor of Modern Languages majoring in Political Science and International Relations, French Studies, and German Studies at the University of Western Australia.
During his fellowship, James looks forward to exploring contemporary geopolitical developments shaping Europe and the wider Eurasian region, including their implications for Australia and our region, the Indo-Pacific.
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