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Europe postpones FTA negotiations with Australia

Australia

The European Union has postponed the next round of negotiations for a free trade agreement with Australia for another month.

The move is believed to be retribution for the cancellation of a $90 billion submarine contract with French company Naval Group.

The backflip sparked a major diplomatic row with France, one of the European Union’s largest members, and now appears to have hit ties with the entire bloc.

France has publicly said it can no longer trust the Morrison Government, accusing officials of lying and questioning whether the trade agreement can go ahead.

The 12th round of negotiations between Australian and EU officials has been postponed to November for now.

Peter Jones, Founder of Prological, says the delay works against Australia’s best interest in the medium and long term.

“At a time when COVID-19 has shown us the potential gains of being more self-sufficient from a manufacturing perspective, to find ourselves in the position we are in now with the EU challenges the nation’s best interest,” Peter says.

“We need these agreements in place to be able to foster Australian industry and manufacturing, both in terms of being able to competitively procure that which these other nations produce, as well as opening up doors for our own businesses to be able to export in a very competitive global environment.”

Trade Minister Dan Tehan has urged the EU to stick with the FTA.

“A free trade agreement is in the interests of Australia and the European Union and will strengthen our relationship that is built on a shared commitment to democracy, human rights, the rule of law and economic openness,” Dan says.

“We understand the French reaction to our submarine decision, but ultimately any nation must act in its national interest – which is what Australia has done.”

European Commission officials in Brussels listed a range of unresolved issues for the delay, including geographical indications, market access, intellectual property rights, public procurement and sustainable development.

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