EU-Australia Trade Deal: A Test for the Rules-Based Order?

Canberra is poised to host the signing of a free trade agreement between the European Union and Australia this week, a development heralded by both sides as a strengthening of economic ties. European Commission President Ursula von der Leyen and Trade Commissioner Maros Sefcovic are traveling to Australia as the deal nears finalization, following similar agreements recently concluded by the EU with Mercosur and India. Australia, too, has been actively forging new trade partnerships, recently finalizing an agreement with the UAE and seeking closer economic collaboration with India. However, this flurry of trade activity raises a critical question: as these nations prioritize economic interests, are they adequately defending the international rules-based order upon which such agreements depend?

The question isn’t merely academic. Recent statements and actions by both the EU and Australia suggest a growing tension between their stated commitment to international law and their pursuit of pragmatic, “interest-driven” foreign policy. This divergence is particularly concerning given the current geopolitical landscape, marked by increasing global uncertainties largely attributed to the policies of US President Donald Trump and the rise of alternative economic models, such as China’s, which often prioritize economic gain over human rights concerns.

Von der Leyen’s Shifting Rhetoric and the Question of Commitment

Ursula von der Leyen recently sparked debate with a speech in which she suggested Europe should move beyond being a “custodian for the old-world order,” advocating for a more “realistic and interest-driven foreign policy.” While she subsequently reaffirmed her commitment to international law following criticism, as reported by Euronews, the initial remarks raised concerns about a potential shift in the EU’s approach to global affairs. This internal debate within the EU mirrors a broader trend of questioning the efficacy of traditional multilateralism in a rapidly changing world.

Policy Discrepancies: Migration, Double Standards, and the Middle East

The gap between rhetoric and action is further highlighted by specific policy areas. Human Rights Watch has documented abusive migration policies employed by the EU, and Australia’s continued use of offshore detention, described as “cruel and costly.” These practices raise questions about the commitment of both entities to upholding fundamental human rights principles, which are cornerstones of the rules-based order. Perceived double standards in foreign policy, particularly concerning the Middle East, have eroded trust and undermined their credibility. Australia and the EU have been criticized for a “one-sided approach” to denouncing rights abuses and laws of war violations in the region, demonstrating a selective application of principles.

The China Factor and the “Low Rights” Economic Model

Amidst growing global uncertainties, the EU and Australia face a critical choice regarding their economic partnerships. The rise of China and its “low rights” economic model – prioritizing economic growth over labor rights, environmental protection, and political freedoms – presents a challenge to the established rules-based order. As noted by Human Rights Watch, Trump’s policies have spurred a “rush to China” for trade salvation, a trend that risks rewarding nations with poor human rights records. Rejecting this model and actively promoting rights-based trade is crucial for maintaining the integrity of the international system.

Trade as a Lever for Rights and Environmental Protection

To effectively defend the rules-based order, both the EU and Australia need to integrate human rights and environmental protection into their trade agreements. The Australian Parliament’s Joint Standing Committee on Trade and Investment Growth has recommended utilizing trade to advance these goals, while the EU is treaty-bound to do the same. This means focusing on labor reforms in negotiations with countries like Thailand and Gulf states, rather than overlooking repression as has been the case with India and Vietnam. Specifically, the EU should address migrant worker rights in trade talks with Thailand and ensure human rights considerations are central to agreements with Gulf countries.

Corporate Accountability and Due Diligence

Beyond trade agreements, strengthening corporate accountability is essential. Von der Leyen’s recent efforts to roll back EU regulations aimed at addressing corporate abuses have been criticized for undoing years of progress. Australia, meanwhile, should adopt human rights due diligence legislation to ensure companies are held responsible for their impacts on human rights throughout their supply chains.

Upholding International Law: Israel and Beyond

A consistent and principled application of international law is paramount. Both the EU and Australia should ban trade with Israel’s illegal settlements in the occupied territories and end their perceived bias in addressing rights abuses and violations of the laws of war in the Middle East. This requires a commitment to impartiality and a willingness to hold all parties accountable for their actions.

Investing in the UN Human Rights System

a robust defense of the rules-based order requires sustained investment in the United Nations human rights system. Both the EU and Australia should consistently implement policies inspired by UN human rights mechanisms and prioritize the organization’s work.

The signing of the EU-Australia trade agreement represents an opportunity to reaffirm their “shared commitment” to the international rules-based order. However, words alone are insufficient. We see their actions – their willingness to prioritize human rights, uphold international law, and challenge economic models that undermine fundamental freedoms – that will ultimately determine whether this commitment is genuine and enduring, particularly at a time when the international system is facing unprecedented challenges.