EU chief in Australia with eyes on trade deal

BRUSSELS

EU chief Ursula von der Leyen arrived in Australia Monday, with hopes a free trade deal can be struck after years of negotiations.

It is the EU chief's first trip to Australia since taking office and comes as the bloc and import-reliant nation navigate renewed energy vulnerability sparked by the war in the Middle East.

She arrived in Sydney Monday for a meeting with Australia's head of the state, the Governor-General, and a traditional welcoming ceremony.

From Sydney, the EU chief will head to Canberra, where she is expected to meet Prime Minister Anthony Albanese and address the country's parliament.

Von der Leyen is joined by EU trade commissioner Maros Sefcovic, sparking speculation the two sides may finally put pen to paper on a long-awaited free trade deal.

Both are still ironing out the details of the agreement, with improved access to the European market for Australia's lamb and beef a key source of contention.

Australia has previously said it could drop a luxury car tax on European vehicles in return for greater access to the EU agriculture market.

The country's use of geographical indicator names for cheese and wine products was also a sticking point.

Australia's largest export market is China and the United States is its largest source of investment.

But Canberra has redoubled efforts to diversify export markets for farmers since a 2020 dispute with Beijing saw agriculture exports blocked for several years, and then last year's global imposition of U.S. trade tariffs.

The European Union is Australia's third largest two-way trading partner and second largest source of foreign investment.

Trade Minister Don Farrell last week said that an EU deal would add Aus$10 billion ($7.1 billion) in trade for Australia in the first year.