Against the odds—a free trade agreement between the European Union and Australia?

Abstract

The European Union (EU) and Australia have embarked officially on a free trade agreement (FTA) negotiation process, a procedure expected to last no less than 5 years. Public pronouncements from both sides which announced the beginning of the process of negotiating an FTA marked a significant departure from the well-known tensions and difficulties which date back to the late 1950s. British entry into the then European Economic Community in 1973 meant that it had to align its trade policies with the much contested European Common Agricultural Policy (CAP). This had been implemented in the late 1960s and provided limitless reasons for antagonism between Australia and the EU. Yet, over time, the trade agenda changed for both sides with new actors and new agreements, and some of the previous machinery no longer providing the liberalisation of trade as intended. Both the EU and Australia have moved on—some of this change due to new political actors and new economic realities. Despite the tortured history between them, and mindful that some might be sceptical about this change of heart, real politik often imposes its own political will and the new needs may well be in sharp contrast to the past relationships. The prospect of an FTA shows how the trappings of history might be side stepped by a stronger, almost opportunistic, sense of economic benefits however small they might appear.