EU Commission: EU and Australia conclude free trade agreement and establish security and defense partnership

The EU and Australia have concluded their negotiations on an ambitious free trade agreement (FTA). They also announced the establishment of a security and defense partnership. Both sides also agreed to begin formal negotiations on Australia’s association with Horizon Europe, the world’s largest research and innovation program.

EU Commission President Ursula von der Leyen welcomed the strengthening of bilateral relations: “The EU and Australia may be far apart geographically, but we couldn’t be closer in terms of the way we see the world. With these dynamic new partnerships in the areas of security and defense and trade, we are moving even closer together. These agreements create lasting, trusting structures to support peace and security through strength, promote prosperity through rules-based trade and jointly support global institutions. We are committed to building a cleaner, more digital future for our citizens, workers and businesses. And we are sending a strong signal to the rest of the world that friendship and cooperation matter most in times of turmoil.”

Partnership for security and defense

The Security and Defense Partnership (SDP) will create a robust institutional framework:

• Security and defense dialogues will enable closer coordination on strategic priorities and translate shared values and interests into practical cooperation;
• Strengthen cooperation in crisis management and Common Security and Defense Policy missions and operations, including exercises, training and education;
• improving cooperation on maritime security, cybersecurity, countering hybrid threats and foreign information manipulation and interference;
• Promoting close coordination on new and disruptive technologies, including artificial intelligence, as well as in the areas of space security, non-proliferation and disarmament;
• Intensifying exchanges on situational awareness in different regions;
• Supporting capacity building of partners, including in the Indo-Pacific region, and strengthening coordination in multilateral and regional fora; and
• Deepening cooperation in response to evolving security challenges through a flexible and forward-looking approach.

A balanced and ambitious free trade agreement

With the conclusion of negotiations on an ambitious and balanced Free Trade Agreement (FTA), the EU is opening up the market to one of the fastest growing industrialized nations in the world, providing significant economic opportunities for European businesses, consumers and farmers.

EU exports are expected to grow by up to 33 percent over the next ten years, with the value of exports potentially reaching up to 17.7 billion euros annually. Key sectors with strong growth potential include dairy products (expected to grow by up to 48 percent), motor vehicles (52 percent) and chemicals (20 percent). EU investment in Australia could increase by over 87 percent.

This agreement also strengthens the EU’s strategic interests in the area of critical raw materials and makes the EU’s supply chains more resilient to geopolitical shocks. The free trade agreement also contains strong sustainability commitments that contribute to greener and fairer trade and ensure that imports into the EU are more closely aligned with the EU’s own production standards in the areas of climate, environment and animal welfare.

Following the recently concluded agreements with Indonesia and India, this agreement further diversifies the EU’s network of trading partners in the strategically important Indo-Pacific region and strengthens Europe’s position on the global stage.

This translation was generated automatically. 

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Background

The final text of the free trade agreement was agreed at a meeting between Commission President von der Leyen and Australian Prime Minister Anthony Albanese in Canberra.

The Security and Defense Partnership (SDP) was signed virtually on 18 March 2026 by EU High Representative Kaja Kallas, Australian Deputy Prime Minister and Minister for Defence Richard Donald Marles and Minister for Foreign Affairs Penny Wong.

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Further information

👉 Full press release

👉 Statement by President von der Leyen at the joint press conference

👉 Joint statement