Damon Mcknight
Australia and Germany have a long history of cultural ties, with Germans among the first European settlers in Australia, and an estimated one million Australians of German descent. Germany is Australia's second-largest trading partner in Europe, with Germany exporting motor vehicles, medicines, and machinery, and importing agricultural products, gold, and energy sources from Australia. While there is no bilateral free trade agreement between the two countries, Australia has been negotiating an agreement with the European Union since 2018, of which Germany is a member. This agreement aims to strengthen economic exchange and provide new opportunities for Australian goods and services in the European market.
| Characteristics | Values |
|---|---|
| Status of free trade agreement between Australia and Germany | No free trade agreement between Australia and Germany as of April 2025. However, Germany is Australia's second most important trading partner in Europe. |
| Australia-European Union Free Trade Agreement | Negotiations for a free trade agreement between the EU and Australia have been ongoing since 2018. |
| Australia's free trade agreements | Australia has free trade agreements with New Zealand, Brunei, Burma, Malaysia, the Philippines, Singapore, Vietnam, Thailand, China, Japan, Laos, India, the United States, and the United Kingdom. |
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What You'll Learn
- Germany is Australia's second-largest trading partner in Europe
- Australia and Germany have a long tradition of close cultural ties
- Germany's main exports to Australia are motor vehicles, medicines, and machinery
- Australia's exports to Germany include agricultural products, gold, and energy sources
- Australia is seeking an FTA with the EU to drive exports, economic growth, and job creation
Germany is Australia's second-largest trading partner in Europe
Australia and Germany have a long history of close cultural ties. Germans were among the first European settlers in Australia, and it is estimated that up to one million Australians have German roots. This cultural connection has contributed to the strong trade relationship between the two countries.
In recent years, there has been a push to further strengthen the economic exchange between Australia and Germany. Negotiations for a free trade agreement (FTA) between the EU and Australia have been ongoing since 2018. An FTA with the EU is economically and strategically important for Australia, as it would provide new opportunities for Australian goods and services in a large, high-income market. It would also give Australian companies a competitive edge and greater choices about where they do business.
The EU, as a bloc, is Australia's third-largest two-way trading partner and source of foreign investment. By negotiating an FTA with the EU, Australia aims to drive exports, economic growth, and job creation. This agreement would build upon the natural partnership between Australia and the EU, which is based on a shared commitment to the rule of law, global norms, and free and open markets.
While Germany is Australia's second-largest trading partner in Europe, the UK remains Australia's most important trading partner on the continent. Australia has recently signed a free trade agreement with the UK, further strengthening their economic relationship. Nonetheless, the ongoing negotiations between Australia and the EU, including Germany, have the potential to significantly impact the trade landscape for all involved parties.
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Australia and Germany have a long tradition of close cultural ties
Australia and Germany have enjoyed 70 years of diplomatic relations as of 2022. The two countries have a long tradition of close cultural ties, with Germans being among the first European settlers in Australia. It is estimated that up to one million Australians have German roots. Goethe-Instituts and German schools can be found in Sydney and Melbourne.
In 2018, the two countries founded the 'Australia-Germany Research Network' in partnership with the German Embassy in Canberra, bringing together German and Australian scientists. The network has facilitated cooperation in addressing climate change and reducing emissions. In June 2021, Australia and Germany announced the Hydrogen Accord, an initiative to deepen their cooperation in the energy sector.
The arts and culture play a significant role in the Australian-German relationship. Australia has been promoting its arts, dance, theatre, music, food, wine, and culture in Germany. The Australian Embassy in Berlin is focused on strengthening the presence of Australian arts and culture in Germany.
Australia and Germany have also been linked since 2013 by a comprehensive strategic partnership, which was expanded in 2021. This has paved the way for closer cooperation in business and research, in a multilateral context, and on security matters. Germany is Australia's second most important trading partner in Europe, after the UK.
Negotiations have been ongoing since 2018 on a free trade agreement between the European Union (EU) and Australia. The EU is a massive, high-income market of almost 446 million people with a nominal GDP of US$18.6 trillion in 2023. As a bloc, it is Australia's third-largest two-way trading partner and third-largest source of foreign investment. An ambitious and comprehensive FTA with the EU is important economically and strategically for both parties.
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Germany's main exports to Australia are motor vehicles, medicines, and machinery
Germany and Australia have a strong trading relationship, with Germany being Australia's second most important trading partner in Europe. In 2023, Germany exported $13 billion worth of goods to Australia, with the main exports being motor vehicles, medicines and machinery.
Motor vehicles make up a significant proportion of Germany's exports to Australia, with cars and motor caravans being the single largest export category. In 2023, Germany exported $1.98 billion worth of cars to Australia, contributing to the broader category of motor vehicles. This category also includes lorries and special purpose motor vehicles, which were worth €39 million in exports in December 2024.
Medicines are another key export from Germany to Australia. This category includes packaged medicaments, vaccines, blood, antisera, toxins, and cultures. In 2023, Germany exported $783 million worth of packaged medicaments and $716 million worth of vaccines and related products to Australia.
Machinery is also a significant component of Germany's exports to Australia. While there is some overlap with the motor vehicles category, machinery exports also include items such as machinery for mining, quarrying, and construction. In December 2024, Germany exported €44.7 million worth of "other machinery" to Australia, demonstrating the ongoing demand for German-made machinery in the Australian market.
These three categories of exports—motor vehicles, medicines, and machinery—form the backbone of the trading relationship between Germany and Australia. Negotiations for a free trade agreement between the European Union (which includes Germany) and Australia began in 2018. Such an agreement would further strengthen the economic ties between the two countries, reducing barriers to trade and investment. With Germany already being a crucial trading partner for Australia, a free trade agreement would have significant implications for both economies.
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Australia's exports to Germany include agricultural products, gold, and energy sources
Germany is Australia's second most important trading partner in Europe. Australia's exports to Germany include agricultural products, gold, and energy sources. In 2023, Australia exported $4.88 billion worth of goods to Germany, with the top three exported products being coal briquettes ($2.18 billion), rapeseed ($800 million), and copper ore ($296 million).
Agricultural products make up a significant portion of Australia's exports to Germany. In December 2024, oilseed and oleaginous fruits were among the top imports from Australia, valued at €10.1 million. Rapeseed is another important agricultural export, contributing $800 million in 2023.
Gold and other precious metals are also exported from Australia to Germany. The export of precious metals contributes significantly to the trade relationship between the two countries.
Energy sources, such as coal and coal briquettes, are another vital component of Australia's exports to Germany. In December 2024, coal and coal briquettes were valued at €193 million in imports from Australia. Additionally, Australia is well-positioned to become a significant supplier of green hydrogen to Germany. Germany's transition to a decarbonized economy will likely result in increased demand for renewable energy sources, and Australia is poised to meet this demand with its abundant solar and wind energy resources.
The trade relationship between Australia and Germany is strong and diverse, with a range of exports contributing to the economic exchange between the two countries. Negotiations for a free trade agreement between the European Union and Australia have been ongoing since 2018, aiming to further strengthen their economic relationship.
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Australia is seeking an FTA with the EU to drive exports, economic growth, and job creation
Australia is seeking a free trade agreement (FTA) with the European Union (EU) to boost exports, economic growth, and job creation. An FTA with the EU is important economically and strategically, providing new opportunities for Australian goods and services in a significant market.
The EU is a massive, high-income market of almost 446 million people with a nominal GDP of US$18.6 trillion in 2023. It is Australia's third-largest two-way trading partner and third-largest source of foreign investment. An FTA with the EU will provide Australian exporters with a competitive edge and more choices about where they do business. It will also benefit Australian consumers and companies through greater choice and lower prices.
Australia will seek to guarantee access for Australian service exporters to the EU and create new opportunities in sectors of key commercial interest, such as education, financial and professional services. An FTA will establish a framework for the mutual recognition of professional licensing and qualifications, providing greater certainty for skilled professionals entering the EU labour market.
Australia will also prioritise achieving a secure online environment to support the growth of e-commerce with the EU and promote sustainable development through mutually supportive trade and environmental policies. Australia's negotiating position is informed by input from stakeholders, who are invited to express their views through public meetings, industry-specific consultations, or written submissions.
Australia has a strong tradition of advocating for an open global economy and reducing barriers to trade and investment through FTAs. An FTA with the EU will build upon the natural partnership between Australia and the EU, arising from a shared commitment to the rule of law, global norms, and free and open markets.
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Frequently asked questions
No, Australia does not have a free trade agreement with Germany. However, Germany is Australia's second most important trading partner in Europe. Negotiations have been ongoing since 2018 for a free trade agreement between the EU and Australia.
A free trade agreement (FTA) is an international treaty between two or more economies that reduces or eliminates certain barriers to trade in goods and services, as well as investment.
Australia has FTAs with New Zealand, ASEAN, RCEP, India, the UK, and the US.
An FTA with the EU is important economically and strategically for both Australia and the EU, providing new opportunities in a highly significant market for Australian goods and services. It will provide Australian exporters with a competitive edge and more choices about where they do business.
