EU halts trade talks with Australia

Canberra’s decision to cancel a major French submarine contract also has consequences for its relations with the European Union. An EU official claimed that “the trade cycle of the FTA has been postponed for a month until November”. A decision that undermines these long-planned negotiations on a possible free trade agreement (FTA) between Australia and the European Union.

“We understand France’s reaction to our decision on the submarines, but at the end of the day any nation must act in its national interest – which Australia has done,” the Australian minister tried to play down. trade, Dan Tehan, who was to travel to Europe for negotiations. He said he planned to meet with EU Trade Commissioner Valdis Dombrovskis next week. “We will continue to prepare for the 12th round of negotiations and work towards a free trade agreement that is in the best interests of Australia and the EU,” he said.

Australian officials accused of lying

Last month, Australia without warning severed the contract to purchase twelve French conventional-powered submarines valued at A $ 90 billion (€ 55 billion), choosing to buy from the instead of nuclear-powered ships of American design. The move sparked a major diplomatic conflict with France, which has publicly declared that it can no longer trust the Australian government, accusing officials of lying and questioning the continuation of the trade deal.

The French government has recalled its ambassadors from Canberra and Washington, a rare move to protest the behavior of the allies. The French ambassador returned to the United States on Wednesday, but there is no indication yet that Australian Ambassador Jean-Pierre Thebault will return.

The EU is Australia’s third largest trading partner

Prime Minister Scott Morrison “did not act in good faith. He deliberately deceived France, ”former Australian Prime Minister Malcolm Turnbull told reporters this week of his successor. “France believes it has been deceived and humiliated, and it has been. This betrayal of trust will mark our relations with Europe for years to come, ”he added.

The EU is Australia’s third largest trading partner. In 2020, trade in goods between the two economies was valued at 36 billion euros and 26 billion euros for services. The next round of negotiations was to cover areas such as trade, services, investment and intellectual property rights.

Trade talks began in 2018 and negotiators had hoped to reach a final deal by the end of the year. But with Australia and France both heading for elections in early 2022, that timeline now looks optimistic.

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