Australia and EU sign US$7B trade deal eliminating wine tariffs and boosting bilateral exports  

AUSTRALIA – Australia and the European Union have signed a comprehensive free trade agreement in Canberra valued at approximately A$10 billion (US$7 billion), marking the conclusion of eight years of negotiations.  

The deal was described as a “win-win” by Australian Prime Minister Anthony Albanese and European Commission President Ursula von der Leyen, who both emphasised its focus on strengthening “collective resilience” in a rapidly evolving global environment.  

A central component of the agreement is the near-total liberalisation of bilateral trade in wines and alcoholic beverages. Effective immediately, the 5% tariffs on wines, sparkling wines and spirits have been eliminated, a move expected to lower prices and increase trade flows between the two regions.  

European wineries will now have tariff-free access to the Australian market, with exports projected to grow by 10–20% in the early years of the agreement. Australian importers and consumers are expected to benefit from annual savings of approximately $36–37 million in tariffs on European wines and spirits.  

In the short term, export volumes are anticipated to rise significantly. European wine exports to Australia could increase by up to 20%, while Australian wine shipments to the EU are forecast to grow by 10–15%.  

Over the medium term, European Commission economic models suggest that EU wine exports to Australia could expand by more than 30% in volume.  

The agreement also addresses regulatory challenges by recognising each party’s winemaking practices under standards set by the International Organisation of Vine and Wine. However, both sides will retain their own food safety and sanitary regulations.  

Enhanced protection for Geographical Indications (GIs) forms another key pillar of the agreement. More than 1,600 European GIs, including Champagne and Prosecco, will be recognised in Australia.  

Transitional arrangements allow Australian producers currently using certain names, such as “Prosecco,” to continue domestic use for up to 10 years, although new usage and exports under those names will be restricted.  

The European Committee of Wine Companies (CEEV) welcomed the agreement, with President Marzia Varvaglione stating that it represents “a concrete opportunity to diversify exports and strengthen global competitiveness for EU wine companies.”  

Ignacio Sánchez Recarte, Secretary General of CEEV, added that while GI protection was one of the most sensitive aspects of the negotiations, the compromise reached on Prosecco labelling was balanced given the complexity of the issue.  

Australia is currently the EU’s 11th largest wine export market, with exports exceeding €300 million (US$324 million) annually. In comparison, Australian wine exports to Europe reached €155 million (US$167 million) in the last marketing year.  

Over the longer term, the agreement is expected to support deeper integration of the wine industries in both regions, alongside increased investment and expanded product offerings for consumers.  

Sign up HERE to receive our email newsletters with the latest news and insights from Africa and around the world, and follow us on our WhatsApp channel for updates.