Industry backs patience on high-quality EU trade deal

Australia’s free trade talks with the European Union have broken down, but business and farm groups say no deal is better than a bad deal.

The collapse in negotiations could leave both sides without a deal for the foreseeable future as Europe enters domestic election cycles.

Trade Minister Don Farrell held talks with European counterparts on the sidelines of the G7 trade ministers’ meeting in Osaka, but there were not enough concessions Australia could agree to.

A key sticking point had been the use of geographical indicators, which would stop Australian producers being able to use terms such as feta and prosecco.

Acknowledging the prospect of a deal was now harder, Senator Farrell said he remained optimistic.

The two sides had agreed to maintain discussions, he said.

“If the Europeans were to come back next week and say, ‘look, we want to have some further talks’, we’re up for that,” he told ABC TV on Monday.

“Dialogue is the most important part of the job – I’m prepared to keep talking with them.”

Australian Grape and Wine’s Lee McLean commended the Australian government for walking away from the deal.

“Any outcome that sought to reduce our existing market access would be detrimental to our burgeoning prosecco industry,” Mr McLean said from Osaka.

“Australian prosecco producers just want to retain the right to use ‘prosecco’ as a grape variety in both our domestic and international markets.”

The National Farmers’ Federation also welcomed the trade minister’s decision not to sign up to a deal that would have left the agriculture sector worse off.

“(The) decision was a hard one, but ultimately it was the right one,” the group’s president David Jochinke said.

“What was on offer would have hardwired protectionism into our trading relationship with Europe for another generation.”

NSW farmer Chris Stillard, who exports some of his horticulture produce, commended the government for not signing the agreement and said farmers would have been giving up too much.

“We can’t get better access for our exports to the EU and yet we’re supposed to bend over backwards with compliance,” Mr Stillard said.

“If we do sign it we’re locked in for 30 to 50 years – we’re better off not signing a bad deal.

“We’ve suffered in the past with bad trade deals. We might as well wait it out a bit longer to get a better deal than signing a bad deal that locks us in for a very long time.”

Agriculture Minister Murray Watt said it was unlikely a trade deal could be negotiated before the current term of federal parliament ends in 2025.

“It may be that we can resume negotiations, but I think that will be some time away,” Senator Watt told ABC Radio on Monday.

“The EU elections will be next year, I can’t see them being in a position to resume negotiations before that.”

The government has said previously it would be willing to walk away from negotiations if it was not in the national interest for Australian producers.

Another sticking point was over new, commercially meaningful access to the European market for Australian agriculture, Senator Watt said.

“That hasn’t happened,” he said, adding Australia had made a number of concessions.

Opposition trade spokesman Kevin Hogan said it was unfortunate the trade deal had collapsed, but the offer wasn’t good enough and geographical indicators had been too restrictive.

Andrew Brown, Dominic Giannini and Liv Casben
(Australian Associated Press)